Published Wed, 15 May 2019 13:37:17 -0400 on Seeking Alpha
As a German, BASF (OTCQX:BASFY) (OTCQX:BFFAF) is a company I've owned for some time. I did not truly load up on this giant however, until December 2018/January 2019. It's now my largest portfolio position when it comes to chemical companies, and this is a position I intend to increase further.
In this article, I'll show you why I consider BASF to be a long-term holding of mine, with excellent future potential and enough safety to consider a decent portfolio allocation. I'll, of course, go into the risks and challenges faced by the company to clarify potential headwinds going forward.
Let's look at BASF!
BASF - Over 150 years of Chemicals
The initialism BASF stands for the Badische Anilin und Soda Fabrik, which was founded in 1865 in Baden. The initial business plan was to use the local gasworks byproduct of tar to produce dyes. It quickly involved the production of Sodium Carbonate, Sulfuric Acid, Ammonia, and other chemicals, and became known as the company IG Farben in Leuna.
During the next 35 years, BASF/IG Farben would be associated with the production of explosives, wartime chemicals and become known as one of the many companies who collaborated with the national socialists during the second world war, benefiting from guaranteed volume and pricing during the time period. The company also produced the magnetophon, the first tape recorder in 1935.
The American authorities confiscated and dissolved IG Farben in 1945 following the... Read more