Jones Lang LaSalle


BASF Extends Engelhard Bid
By Lauren Rae Silva
TheStreet.com Wall Street Reporter
3/6/2006 10:50 AM EST
URL: http://www.thestreet.com/markets/marketfeatures/10271900.html

German chemical company BASF (BF:NYSE ADS) said Monday it extended its tender offer for New Jersey-based competitor Engelhard (EC:NYSE) .

BASF extended the hostile offer until March 17. It's the second time it has moved back the deadline on the offer since launching the bid in early January.

Not surprisingly, holders owning fewer than 1% of Engelhard's outstanding stock have tendered into BASF's $37 per share offer, which had been set to expire Friday. Shares of the company have traded around $40 since BASF first launched its bid Jan. 3, and closed at $39.61 on Friday. When BASF first launched its $4.9 billion bid, Engelhard's stock price shot up 27% in one day. Engelhard's stock, which before the bid never traded above $33, hit an all-time high of $40.92 on Jan. 27.

Late last month, Engelhard said potential suitors signed confidentiality agreements that would allow them to look further at the company's financial performance. The same contract had been offered to BASF, but the company declined to sign.

"We are disappointed that we have been unable to reach an agreement with Engelhard on a confidentiality agreement, but the terms proposed by Engelhard were unacceptable and not in the best interest of Engelhard's stockholders," said Michael Grabicki, a spokesman for BASF.
Although specific details of the confidentiality agreement have not been disclosed, the contentiousness centers around the so-called standstill agreement, which could disrupt BASF's current bid and the opportunity to launch bids in the future.