(MENAFN- AFP) German chemicals giant BASF said Friday it was considering merging its oil and gas unit with the DEA energy firm owned by Russia's billionaire entrepreneur Mikhail Fridman.
"BASF is in discussions regarding a potential merger of BASF group's oil and gas activities with LetterOne's oil and gas activities bundled in the DEA group," the German company said in a statement.
"The outcome of the discussions is open and there is no assurance that any transaction will be consummated."
LetterOne is the name of Fridman's Luxembourg-based investment group.
BASF said it would hold the majority of shares if a deal was agreed to combine its Wintershall division with DEA, and that the new entity could potentially be floated on the stock exchange.
A BASF spokesman declined to give further details when contacted by AFP.
But Bloomberg news agency, citing sources familiar with the talks, said negotiations were at an advanced stage and that the merged enterprise would be valued at more than 10 billion euros.
LetterOne purchased DEA, which specialises in oil and gas exploration and production, from German energy group RWE in 2015 for 5.1 billion euros.
At the time, BASF was also believed to be interested in snapping up the division.
Shares in BASF jumped more than three percent on the news to 95.28 euros in late afternoon trading in Frankfurt.
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