2021-11-17-科尔尼-Executive_interview_with_Theodore_M._Clark_and_Traci_Jensen_14页_1mb

Chemicals Executive M&A Report 2018 Summary

Core Content

This report provides an analysis of M&A activity in the chemicals industry from 2008 to 2017 and offers an outlook for 2018. It is based on a survey of executives from leading chemicals companies, investment banks, and investors, conducted in late 2017 and early 2018. The report highlights the evolving nature of M&A in the industry, emphasizing the shift from simple to more complex transactions.

Main Findings

• The "simple" endgame of M&A in the chemicals industry is over. The next wave of deals is expected to be more complex.
• In 2017, while the volume of announced deals increased, the deal value decreased significantly.
• There was a trend of Western consolidation and Chinese expansion toward the West.
• M&A activity is likely to focus on growth and market position enhancement as the economy moves into a growth phase.
• The adhesives and sealants industry remains highly fragmented, with continued consolidation expected.

M&A Outlook for 2018

• Chemicals executives are more bullish than ever, but there are fewer attractive targets available.
• Companies are expected to pursue "bolt-on" acquisitions to acquire new technologies or niche market segments.
• The long-term outlook remains uncertain due to factors like the energy transition and digitization.
• Activist investors are likely to play a more active role, pushing companies to optimize their portfolios and unlock value.

Executive Interview Highlights

Theodore M. Clark and Traci Jensen

Theodore M. Clark

• Former CEO of Royal Adhesives & Sealants and now a senior vice president at H.B. Fuller.
• Believes that M&A is now more about accelerating growth and enhancing market position.
• Highlights the importance of aligning with the target's go-to-market strategies and ensuring retention of key talent.
• Notes that integration is a learned process and that focus and leadership commitment are critical to success.

Traci Jensen

• Senior vice president of H.B. Fuller's Global Construction Products.
• Emphasizes that the acquisition of Royal was a strategic move to expand into aerospace, defense, and construction markets.
• Stresses the importance of customer-centric integration, ensuring that the combined company delivers value to its clients.
• Points out that the integration process is more about people and culture than just financials.

H.B. Fuller Acquires Royal Adhesives & Sealants

• The acquisition was finalized on September 5, 2017, for approximately $1.575 billion.
• Royal is expected to generate $650 million in revenue and $138 million in adjusted EBITDA for H.B. Fuller in fiscal year 2017.
• The deal is expected to deliver $35 million in cost synergies and $15 million in revenue synergies by 2020.
• It significantly shifts H.B. Fuller's portfolio toward high-value, specified adhesive applications in engineering, construction, and durable assembly.

Key Takeaways

• Integration Success: H.B. Fuller's integration of Royal has been successful due to focused execution, leadership commitment, and involving the Royal team in the process.
• Strategic Fit: The acquisition was a strategic fit, with Royal's specialized product portfolio and H.B. Fuller's global reach complementing each other.
• Market Trends: The chemicals industry is moving towards more complex and strategic M&A, driven by the need for growth and market definition.
• Activist Investors: Activist investors are becoming more active in the chemicals sector, pushing companies to re-evaluate their portfolio strategies.

Authors and Contributors

• Otto Schulz (Düsseldorf)
• Viraj Kamat (Chicago)
• Gabriela Baum-D'Ambra (Düsseldorf)
• Felix Carl Schultz (Berlin)
• Patrick Haischer (New York)
• Thomas Rings (Dubai)
• Thomas Luedi (Hong Kong)
• Andrew Walberer (Chicago)

Regional Contacts

Conclusion

The report underscores the importance of strategic M&A in the chemicals industry, driven by growth ambitions, market definition, and the need to optimize portfolios. It highlights the role of people and culture in successful integrations and the increasing influence of activist investors. H.B. Fuller's acquisition of Royal Adhesives & Sealants is presented as a prime example of a strategic and complementary M&A deal that is expected to deliver long-term value.