DELAWARE (From news reports) -- German industrial conglomerate BASF SE and its private equity partner are considering exit options for water treatment specialist Solenis, people with knowledge of the matter said.

BASF and Clayton Dubilier & Rice are working with advisers to examine possibilities including a potential initial public offering or sale of Solenis, the people said. They are seeking a valuation of as much as $5 billion, including debt, the people said, asking not to be identified because the information is private.

Solenis's owners have also held talks with several special purpose acquisition companies, including one started by former Blackstone Group Inc. executive Chinh Chu, the people said.

Deliberations are ongoing, and there's no certainty they will lead to a transaction, the people said. Representatives for Solenis didn't immediately respond to requests for comment. Spokespeople for BASF, CD&R and Chu declined to comment.

Solenis produces specialty chemicals used in water treatment and paper manufacturing. It also makes products for other water-intensive industries including chemical processing, mining and oil production. The company, led by Chief Executive Officer John Panichella, has more than 5,200 employees worldwide, according to its website.

The firm traces its origins to CD&R's $1.8 billion purchase of Ashland Global Holdings Inc.'s water chemicals unit in 2014. It then merged with BASF's paper and water chemicals arm in a deal completed in 2019, creating a company with $3 billion in sales. That transaction gave BASF a 49% stake in the combined company, with the remainder owned by CD&R and Solenis management, according to a statement at the time.