SHARES in industrial gases group BOC were trading frenetically yesterday as speculation mounted that it was a takeover target for German chemicals manufacturer BASF.

Seven million BOC shares changed hands within two hours of the market opening in London - more than twice the daily average for the company.

Traders believe BASF could be willing to pay more than £13 a share to gain control of BOC, which supplies gases used by customers ranging from households to semiconductor companies.

That would value the company at about £6.5bn.

It is believed a bid will be tabled for BOC, which employs 80 people on Teesside, within weeks.

BASF already has a presence in the UK - including a plant at Seal Sands, on Teesside - generating sales of more than £1bn a year.

Its manufacturing reach extends to 41 countries and it has clients worldwide.

Out of a global workforce of 82,000, about 11,000 staff work outside its core German operations in other parts of Europe.

Analysts believe BOC would be a good acquisition for BASF because it would open up new markets and cut its exposure to the volatile chemicals industry.

BASF generated £25.6bn in revenues last year from selling products ranging from chemicals and plastics to crude oil and natural gas.

In contrast, BOC's sales in the past financial year were £4.6bn, although it was able to boost pre-tax profits by 17.2 per cent to £412.3m.

Last month, the company disappointed the market with profits figures for the three months to the end of June, but said it remained happy with the outlook for its worldwide business.

If BASF makes a formal bid, it is thought that UK rival ICI could be tempted to make an offer for the company.