Chemistry Lesson.

BASF SE; HAMBRECHT, Jurgen; CHEMICAL industry laws; CHEMICAL engineering; MANUFACTURING processes; STOCKS (Finance); EUROPEAN Union

This article focuses on BASF. Looking out a window on the 21st floor of BASF's headquarters in Ludwigshafen, on Germany's Rhine River, Jürgen Hambrecht should be proud of what is below. Spread over a 3-square-mile industrial campus sits a model of German engineering efficiency: the verbund, an integrated manufacturing system that starts with crude petroleum, separates it into chemical components and pumps these into plants that create new chemicals while spitting out the by-products as ingredients for yet other chemical processes. Despite a growth record and a nice dividend, the shares languish at 13 times trailing earnings. The proposed chemical sector "Reach" rules, now before European Union potentates in Brussels, run to 1,300 pages. The rules make little distinction between harmless and toxic chemicals and could cost BASF $750 million over the next decade.