BASF said it has entered exploratory, non-binding takeover talks with smaller German chemicals producer Evonik and RAG-Stiftung, Evonik’s largest shareholder. Evonik and the foundation, which holds a 43.8% stake in Evonik, confirmed BASF’s approach. The potential tie-up would strengthen BASF’s position in Europe’s chemicals industry. Earlier reports had described the approach as a merger proposal and said Evonik was unaware of it. Evonik shares had risen 8% to a three-month high in that earlier market reaction, while BASF was later quoted down 3.59%.