Carlyle is moving closer to the next phase of its €7.7bn acquisition of BASF SE’s coatings business, as banks prepare to syndicate around €4bn of debt to finance the buyout, Bloomberg reported.

Bank of America and Goldman Sachs are among the lenders arranging a package expected to include leveraged loans in both dollars and euros, as well as euro-denominated senior secured notes. According to people familiar with the matter, syndication is targeted for late March or early April.

The financing underpins Carlyle’s binding agreement with BASF, struck last year alongside co-investor Qatar Investment Authority, to carve out BASF Coatings into a standalone company. BASF will retain a 40% stake in the business following completion. The transaction values the coatings unit at an enterprise value of €7.7bn.

BASF Coatings produces high-performance automotive coatings and surface treatments for metal, plastic, and glass applications across a range of sectors. The business reported approximately €3.8bn in sales in 2024.

The deal lands at a delicate moment for Europe’s chemicals sector, which has been grappling with rising costs and competition from cheaper imports. Carlyle-backed Nouryon withdrew a planned $5.8bn dual-currency leveraged loan in October after investor resistance, underscoring the scrutiny facing large credit packages in the sector.

Still, the broader leveraged finance market has shown resilience in early 2026. Several large buyout financings are currently lining up for syndication across both US and European markets. Recent transactions, including the $8.75bn financing supporting the Hologic buyout, have demonstrated continued demand for acquisition debt, even in the junk-rated segment.

For Carlyle, the BASF Coatings carve-out represents a significant European industrial play at scale. The success of the upcoming €4bn debt sale will offer an important read-through on investor appetite for large-cap, cyclical assets in a market that has so far proven more accommodating to risk than many expected at the start of the year.

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