FRANKFURT (Reuters) – BASF, the world’s largest chemicals company, is considering a partial listing of its agrochemicals business, its new chief executive told employees on a conference call.

Markus Kamieth believes that the market is underestimating the profit prospects of this unit, which produces herbicides and fungicides, among other things.

The group is also considering strategic options for its coatings division, which mainly supplies the automotive industry, for example with surface treatments used against corrosion.

Those options could include a joint venture or finding another owner for the unit, according to a recording of the call seen by Reuters.

A source familiar with the matter told Reuters that no potential buyers had approached BASF about its coatings division. BASF, which is scheduled to hold an investor day on Thursday, declined to comment.

Since taking office in April, CEO Markus Kamieth has continued his predecessor’s efforts to cut the group’s spending in Europe and reduce its dependence on sluggish markets on the Old Continent.

BASF is also building a 10 billion euro chemical complex in southern China to take advantage of faster growth in Asia.

The head of the German giant, however, told employees that he was more optimistic about the chemical complex in Ludwigshafen, Germany, where BASF is headquartered.

The site is competitive “in its core business” but around 15 to 20% of the complex’s power stations, described as “rather peripheral”, should be monitored over the next few years.

Last December, BASF announced plans to spin off its agriculture, battery materials and coatings divisions into stand-alone units to boost profits.

The Agricultural Solutions division generated sales of around 10 billion euros last year, competing with BASF’s compatriot Bayer, as well as the American Corteva and the Chinese Syngenta.

(Reporting by Ludwig Burger; by Florence Loève, edited by Kate Entringer)

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