BASF Marks Year-End With Strong Growth Outlook, Continued Major Capital Investments in North America.

NEW YORK--(BUSINESS WIRE)--Dec. 7, 1999--

A billion-dollar North American capital investment program and a major acquisition highlighted an "eventful" fiscal 1999 for BASF Corporation, according to Peter Oakley, chairman and chief executive.

In his annual press briefing today, Oakley described BASF's recently-announced acquisition of Chemdal International and its superabsorbents business as "a major move to more firmly establish BASF in this high growth, cyclically resilient industry.

"I think you can understand our enthusiasm for this acquisition: It fits in the BASF value chain; it's not cyclical; it represents a growing market; and BASF will now have world-scale production capacity, all of which makes us a formidable competitor," Oakley said.

Among other highlights of fiscal '99, Oakley said BASF took other significant steps to implement its strategy. They included the beginning of construction of the world's largest butadiene extraction facility in Port Arthur, TX, with partners Shell Chemical Company and FINA Oil and Chemical Company.

This project's synergies will complement those expected from the integration of the steam cracker under construction adjacent to FINA's refinery.

Construction on the steam cracker itself, also in partnership with FINA, met scheduling and budget targets in 1999, Oakley said. "This billion-dollar project will provide raw materials economically and reliably to our major sites in Freeport, Texas and Geismar, Louisiana, and to many other BASF sites in North America," he added.

Oakley also detailed BASF's capital investment plans in North America. "We are in the midst of a long-term capital investment program which has directed about $1 billion per year in new plant and equipment in the last two years."

In 1997 and 1998, major investments were made in infrastructure and ecology, Oakley said. With those investments in place, "we are now ready to apply our capital investments toward top-line growth and toward achieving significant competitive advantages through backward integration.

"What's more remarkable is that BASF will bring a new plant on stream in almost every calendar quarter during the next two years. That includes new capacity, replacement and modernization, streamlining and backward integration which we believe will make BASF an even more formidable competitor in North America."

BASF's strategy in North America will continue to focus on expansion of cyclically resilient activities, achievement of cost and market leadership positions in cyclical businesses, and expansion of businesses in growth markets.

"We achieved milestones in each of these areas in 1999. And, we expect this strategy to bring sustained profitability and higher returns for the long haul," Oakley said.

BASF Corporation is among the top five producers of chemicals and related products in the United States, Canada and Mexico, with sales of $7.2 billion in 1998. BASF in North America has its regional headquarters in Mount Olive, N.J., and is a member of the BASF Group (Ludwigshafen, Germany). "We don't make a lot of the products you buy. We make a lot of the products you buy better.(R)" summarizes the diverse product mix BASF offers, such as chemicals, polymers, automotive coatings, colorants, pharmaceuticals, nylon fibers and agricultural products. BASF in North America employs more than 15,000 people at more than 40 locations, and has an internet site at http://www.basf.com. Slogan is a registered trademark of BASF Corporation.