2018年-普华永道全球_Global_chemicals_deals_insights_Q1_2018_6页_1mb

PwC Chemicals M&A Q1 2018 Summary

Core Content

The first quarter of 2018 marked a strong start for chemicals M&A activity, with a total deal value of $24.1 billion, a 27% increase compared to Q1 2017 and a 48% rise over the previous quarter's average. The sector saw 203 deals, a 14% decrease from Q1 2017, but the average deal size increased by 65% to $227 million, though it remains 23% below the three-year historical average of $297 million.

Key Trends and Highlights

• Deal Value and Volume:

  • Total deal value in Q1 2018 was $24.1 billion, 17% higher than 2017 YTD and 27% above Q4 2017.
  • Total deal volume was 203, 14% lower than Q1 2017, but 22% higher than Q4 2017.
  • The average deal size increased significantly, reflecting a shift toward larger transactions.

• Largest Transaction:

  • The Carlyle Group's $12.6 billion acquisition of AkzoNobel's Specialty Chemicals business was the largest deal of the quarter and accounted for 52% of the total deal activity in 2018 to date.
  • This deal is expected to be completed by the end of 2018, allowing AkzoNobel to focus on its Paints and Performance Coatings segment.

• Megadeals:

  • The only megadeal (≥$5 billion) announced in Q1 2018 was the Carlyle / AkzoNobel transaction.
  • Other notable deals include LyondellBasell's $2.3 billion acquisition of A Schulman and Givaudan's $1.5 billion acquisition of Naturex.

• Sector Category Analysis:

  • Specialty Chemicals dominated deal activity, contributing 92% of the total value and 52% of the volume.
  • Historical megadeals span multiple categories, including Fertilizers & Agricultural Chemicals, Industrial Gases, and Commodity Chemicals.

• Investor Shift:

  • Financial investors accounted for 60% of deal value this quarter, signaling a growing interest in the sector.
  • Strategic investors still held the majority of deal volume, but the increase in financial interest is attributed to the divestitures from megadeals.

• Regional Analysis:

  • Asia & Oceania: Remained the primary region for deal activity, though its share of deal volume decreased slightly.
  • North America: Showed increased activity, contributing 66% of the deal value and 24% of the volume, up from 17% in 2017.
  • Target Regions: While deal volume is concentrated in North America and Asia, deal value is more evenly distributed, with North America contributing significantly.

Outlook for 2018

• The chemicals M&A market is expected to remain robust throughout 2018, with pending megadeals such as the Bayer / Monsanto and Praxair / Linde transactions driving further activity.
• Regulatory-mandated divestitures from these deals may lead to a surge in new transactions, including potential megadeals.
• Private equity buyers are expected to continue deploying their dry powder, especially in the Specialty Chemicals subsector.
• U.S. chemical companies are likely to become more competitive globally due to tax reforms and increased access to overseas cash.
• Trade tensions, particularly between the U.S. and China, may lead to more cross-border M&A as companies substitute trade with capital.

Conclusion

Chemicals M&A in Q1 2018 showed a strong rebound, driven by tax reforms, regulatory changes, and geopolitical tensions. The shift toward larger financial investor-led deals and the dominance of Specialty Chemicals in transaction value highlight evolving market dynamics. North America's increased share of deal value and volume indicates a growing role in the sector, while the U.S. tax reform is expected to enhance the competitiveness of U.S. chemical firms. With pending megadeals and the potential for regulatory-driven transactions, the outlook for the chemicals M&A market remains positive.

Key Players and Contact Information

• Craig Kocak – US Chemicals Deals Leader
  • Email: craig.m.kocak@pwc.com
  • Phone: (267) 330-2777
• Chris Cardinal – US Chemical Deals Strategy Leader
  • Email: chris.cardinal@pwc.com
  • Phone: (267) 330-1489
• Seamus Jiang – US China Inbound Deals Leader
  • Email: seamus.jiang@pwc.com
  • Phone: (267) 330-1862
• Marcus Morawietz – Global Chemicals Leader
  • Email: marcus.morawietz@strategyand.pwc.com
  • Phone: +49 699 716 74 67

PwC's Deals group offers comprehensive M&A services, including strategy development, due diligence, transaction structuring, and post-deal integration, tailored to the unique needs of chemicals companies and private equity firms.