FRANKFURT (dpa-AFX) – The preliminary failure to sell the remaining shares in the Envalior joint venture has once again sparked concerns among Lanxess shareholders on Friday regarding the specialty chemicals group's financing. Shares plunged more than eight percent shortly after trading opened, dropping to €15.02. Following the recent sector-wide sell-off triggered by the Iran war, this marks the lowest share price since 2009.
Joint venture partner Advent is currently unwilling to acquire the Envalior shares, citing the agreed financing contingency. Now, purchase rights agreed for 2027 and 2028 come into effect.
According to analyst Chetan Udeshi of US bank JPMorgan, balance sheet concerns at Lanxess remain. These have long been the dominant theme of the stock’s narrative. Christian Bell of UBS fears that Lanxess could lose its "investment grade" status with rating agencies. This is commonly referred to as "junk level." As a result, financing costs could rise for the heavily indebted company.
However, the Cologne-based group maintains that it is securely financed in the long term even without the proceeds from the share sale, and that the repayment of the bond maturing in October is already assured, as stated on Thursday evening. Lanxess had originally aimed to raise €1.2 billion this year through the sale, as announced last September.
Udeshi concludes from Advent’s decision that it is also related to a difficult environment for cyclical chemical companies. In his view, this is not yet fully reflected in the share prices of other sector players such as BASF or Wacker Chemie./tih/mis
