BASF Races to Finish €1.5bn Buyback as Silicates Sale Adds to Restructuring Push

BASF rushes to complete €1.5bn share repurchase and sells silicates unit as German chemical industry warns of deep crisis from rising costs, energy woes, and geopolitical disruptions.

The German chemicals giant is sprinting toward the finish line of its €1.5bn share repurchase program while simultaneously trimming its portfolio — a dual approach that unfolds against one of the darkest outlooks the industry has issued in years. BASF shares were changing hands at €50.53 on a recent Tuesday, shedding 0.73%, though they later edged to €50.90, just under their 50-day moving average. The stock has gained roughly 13% since the start of the year, still about 7.6% shy of its 52-week high of €54.70.

The buyback, launched on 3 November 2025, has already scooped up nearly 27.8 million shares worth up to €1.5bn. In the final week of May alone, BASF bought back another 950,000 of its own shares. The program is scheduled to expire at the end of June, meaning the company has only a few weeks left to exhaust the remaining tranche. Investors are watching closely: once the buyback ends, the support it provided to the share price will vanish, putting even greater emphasis on operational performance. The repurchased shares are being cancelled, reducing share capital and boosting earnings per share. This €1.5bn buyback is the first leg of a broader €4bn programme slated to run through 2028. In total, BASF has committed to returning at least €12bn to shareholders between 2025 and 2028 via dividends and buybacks.

Alongside the capital return, BASF is continuing to reshape its business. It has signed an agreement to sell its silicates operation in Düsseldorf/Holthausen to PQ, a specialty chemicals group. Financial terms were not disclosed. The transaction is expected to close in the second half of 2026, pending regulatory approvals. Silicates are inorganic materials used in tyres, paints, coatings, and detergents. BASF said the disposal resulted from a strategic review within its Care Chemicals division, part of a broader push to pivot toward higher-growth core businesses.

The timing of these moves coincides with a stark warning from the German Chemical Industry Association (VCI). Its managing director, Wolfgang Große Entrup, said the industry is “under permanent stress” from rising costs, investment hesitation, and geopolitical disruptions that are destabilising supply chains and energy prices. The VCI cited three main pain points: bureaucracy, energy costs, and raw-material shortages. Output in the chemical and pharmaceutical sector fell 2.8% in the first quarter compared with the previous three months, and was nearly 6% lower year on year. While revenues rose 2.1% on a seasonal basis, the annual comparison still shows a 5.4% decline.

The VCI also flagged the impact of the Strait of Hormuz disruption, which it estimates has cut 20% of global oil and gas supply to the industry, with basic chemicals losing 5% to 10% of their feedstocks. Capacity utilisation edged up to 75.1%, but that level remains insufficient for profitable margins. The association declined to issue a full-year forecast, with Große Entrup adding: “We firmly believe the worst is still ahead of us.”

BASF has not altered its own outlook for 2026 despite the headwinds. It continues to target EBITDA before special items of €6.2bn to €7.0bn and free cash flow of €1.5bn to €2.3bn. The next quarterly report will be closely scrutinised for evidence that its restructuring and cost-saving measures are gaining traction. With the buyback set to end and the silicates sale still months away from closing, the chemical heavyweight is entering a period where operational execution — not financial engineering — will determine how investors judge its transformation efforts.