2020 global chemical industry mergers and acquisitions outlook … · 2020-07-26 · 2020 global...
TRANSCRIPT
2020 Global chemical industry mergers and acquisitions outlookClearing the hurdles
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2020 Global chemical industry mergers and acquisitions outlook | Contents
ContentsIntroduction 4
Trade and geopolitical tensions: the new normal 6
Big oil and SOEs continue moving downstream 7
Sustainability: what’s the M&A impact? 8
Private equity: playing a critical role 9
Mergers and acquisitions activity by chemical sector 10
Mergers and acquisitions activity by geography 12
Summary outlook for 2020 mergers and acquisitions activity 16
Endnotes 17
Contacts 21
Acknowledgements 25
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2020 Global chemical industry mergers and acquisitions outlook | Introduction
Introduction
Total activity (2010 to 2019)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Volume (# of transactions) 579 646 609 537 635 612 650 637 600 585
Value (US$ billions) 55.6 55.1 41.8 31.8 77.8 145.8 231.1 46.4 72.4 178.3
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
Figure 2: Activity over US$1 billion (2010 to 2019)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Volume (# of transactions) 10 11 11 8 13 16 12 13 16 14
Value (US$ billions) 39.2 36.7 23.8 13.6 52.6 126.3 205.7 29.2 58.8 158.5
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
Last year, the 2019 Global chemical industry mergers and acquisitions outlook (2019 Outlook) predicted that global chemical mergers and acquisitions (M&A) activity in 2019 was expected to pull back slightly from 2018 levels against a backdrop of uncertainty—comparatively higher interest rates to start the year, increasing trade and geopolitical tensions, and slowing economic growth in many key markets. Despite the potential for a decrease in M&A deal volume, it was expected that there would still be a robust chemicals M&A market in 2019.
We correctly titled our 2019 Outlook “Navigating headwinds,” as the chemical industry faced plenty in 2019, including trade tensions between the United States and China and slow economic growth in
China and Europe,1 which were evident in the M&A market. Cross-border deals between the United States and China nearly ceased, and oversupply in key commodities ahead of additional capacity coming online gave petrochemical producers plenty to worry about besides M&A.
As seen in Figure 1 and 2, global chemical M&A volumes slid modestly in 2019, with volumes down three percent compared to 2018, though value was up significantly. The increase in value was attributable mainly due to Saudi Aramco’s US$69.1 billion acquisition of 70 percent of SABIC (which valued SABIC at nearly US$100 billion)2 and the announced $26.2 billion acquisition of Dupont Nutrition and Biosciences by International Flavors and
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Figure 1: Global chemical mergers and acquisitions activity (2010 to 2019)
Volume (# of transactions) Value (US$ billions)
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2020 Global chemical industry mergers and acquisitions outlook | Introduction
Fragrances (IFF). After a robust first quarter to start the year in both volume and value compared to 2018, subsequent quarters fell off slightly from their prior year’s volumes. The moderate decline in volumes is likely due to slowing economies, feedstock volatility, and financial challenges in various chemical industry sectors, but might also be attributed to the significant amount of capital investment in new production capacity. Yet despite all these challenges, the industry achieved a very solid year of M&A activity.
And again this year, we have rumors of further mega-deals to come in 2020. Notably, for the past two years, there have been various rumors about a merger between Sinochem and ChemChina.3 While there does not appear to be a merger of the entire businesses on the immediate horizon, in January 2020 the two companies did announce that certain agricultural chemical assets from each of them, including ChemChina’s Syngenta assets, are expected to be combined into a common company,4 which may ultimately be listed through an IPO. There has also been much in the press about Odebrecht finally selling its shares in Braskem after a potential deal with LyondellBasell was terminated.5 Roberto Castello Branco, CEO of Petrobras, another significant shareholder in Braskem, has reportedly objected to delaying the sale of its shares in Braskem for two years and would like to move faster.6
As we look to 2020, one wonders whether continued trade tensions, geopolitical events, and slowing economies will lead to a further decline in M&A activity. Will the much-discussed topic of sustainability drive any M&A in the industry? What chemical sectors will drive M&A activity? Will the increasing challenges faced by the chemical industry reduce M&A or incentivize players to use M&A to grow? As some believe we are late in the economic cycle, will chemical companies and private equity be more hesitant to pull the trigger on acquisitions? Or will the hesitancy be outweighed by the tailwinds of abundant capital and low interest rates?
We invite you to read on as we explore and discuss these and other questions in the 2020 Global chemical industry mergers and acquisitions outlook: Clearing the hurdles.
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2020 Global chemical industry mergers and acquisitions outlook | Trade and geopolitical tensions: the new normal
Trade and geopolitical tensions: the new normalDealing with trade and geopolitical risks is definitely not new to the chemical industry, which has historically dealt with the inherent risk of its primary feedstock supply coming from the Middle East. However, in 2019 it seems that some of the geopolitical events were more acute and the trade tensions were intensifying. In 2019 and early 2020 we saw:
• Heightened trade tensions between China and the United States, including significant tariffs levied on a number of chemical products in each country7
• The September attack on the Saudi Arabia oil distribution and refining infrastructure impacting supply for major chemical feedstocks8
• A likely path forward for a negotiated Brexit following the Conservative party’s sweeping December victory in the United Kingdom9
• Military strikes between the United States and Iran, sending oil prices into a temporary frenzy10
These events have all led to more economic uncertainty and are likely contributing factors to the decrease in 2019 M&A deal volume. With 2020 being an election year in the United States, a year that Brexit’s impact appears to be becoming clearer, and with ongoing tensions in the Middle East, uncertainty may continue to rear its head, providing further hurdles to the year’s M&A activity.
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2020 Global chemical industry mergers and acquisitions outlook | Big oil and SOEs continue moving downstream
Big oil and SOEs continue moving downstreamSimilar to the trend we discussed in our 2019 Outlook, this year we continued to see the trend of traditional oil and gas companies and state-owned enterprises moving downstream into petrochemicals. Saudi Aramco’s acquisition of a 70 percent stake in petrochemical producer SABIC,11 2019’s largest chemical deal, was another example of this continued trend.
While oil companies being integrated with downstream petrochemical production is not new in the industry, chemical production is becoming an increasingly important end-use. With fuel demand waning in many developed economies, petrochemicals, with demand typically projected above GDP growth, have been the focus for many oil companies.12
This continued push into petrochemicals by oil and gas majors has many questioning the ability of standalone petrochemical
companies to compete.13 This could drive further M&A activity as petrochemical companies look to shed disadvantaged assets or move downstream into more specialized intermediates.
However, the oversupply of some commodity chemicals has put margin pressures on many producers, potentially dissuading traditional oil and gas companies from continuing their push into petrochemicals.14 While it is yet to be seen whether the temporary glut in capacity in some petrochemicals will discourage further downstream M&A activity by traditional oil and gas companies in 2020, there is no question that the changing fossil-fuel demand dynamics will continue to spur M&A activity in the chemicals industry over the next decade.
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2020 Global chemical industry mergers and acquisitions outlook | Sustainability: what’s the M&A impact?
Sustainability: what’s the M&A impact?It’s difficult these days to read a news article about the chemical industry or have a conversation with an industry executive without the topic of sustainability arising. Whether driven by consumer activism or government policies and regulation, it is hard to deny that the drive toward sustainability has had and is continuing to have a significant impact on the industry. But has the drive toward a more circular economy impacted M&A activity?
This question is not easily answered, as examples of headline-grabbing M&A that’s been specifically driven by sustainability are few and far between. However, there is no question that stakeholders’ sustainability concerns are changing how chemical companies are thinking about their supply chains and business models. This, in turn, is resulting in more non-traditional M&A activity in the form of new alliances, partnerships, and joint ventures. Examples include:
• Quality Circular Polymers, the LyondellBasell and SUEZ joint venture to recycle post-consumer plastic into a high-quality polypropylene.15
• Eastman Chemical’s partnership with Circular Polymers to reclaim post-consumer carpeting and recycle it into feedstocks for use in Eastman’s products.16
The circular economy is starting to provide real economic incentive as well. As noted in Deloitte’s thought-piece The changing plastics landscape: Is the chemical industry prepared? there’s a US$120-billion market opportunity in the United States and Canada alone for plastics and petrochemicals that could be developed by recovering waste plastics.17 Furthermore, Infoholic Research LLP said in its November 13, 2019, report that it expects the recycled plastics market to grow globally at a 6.8 percent CAGR.18
As the economic opportunities and incentives continue to become clearer, we expect there to be an increase in non-traditional M&A activity—creating new alliances and ecosystems that will drive innovation and secure the recycled material supply and related infrastructure ultimately needed to capture value in the circular economy.
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2020 Global chemical industry mergers and acquisitions outlook | Private equity: playing a critical role
Private equity: playing a critical roleFrom a peak in 2015, chemicals acquisition transactions by private equity groups declined to a post-economic-crisis low in 2018. This decline was generally in line with, or slightly ahead of, the overall decline in M&A deal activity volume.
As shown in Figure 3, 2019 saw a modest recovery. In terms of value, 2019 remained below 2018, but that was almost entirely due to the US$12.5 billion Nouryon transaction in 201819—excluding that deal, 2019 value was down by only seven percent from the prior year.
While there may be several drivers for the decline in private equity activity leading to 2018, the most commonly cited reason was the perception that sector valuations were well above historical norms, and such served to dampen financial sponsor interest. Given we have not seen a significant change in sector valuations in 2019, the increased private equity activity this year points, perhaps, to (a) increased aggressiveness by financial sponsors, (b) the realization that valuations are not going to change any time soon, and (c) a
continuing need to deploy vast amounts of committed capital (recently reported to total a staggering US$1.5 trillion20).
Several transactions in 2019 highlighted these trends. Private equity groups beat out the competition for marquee assets, including, for example, Lone Star’s pending acquisition of BASF’s Construction Chemicals business21, and Advent’s acquisition of Evonik’s Methacrylates business.22 Private equity was also willing to pay up to win prized assets, including, for example, the mid-teen EBITDA multiples paid by Arsenal Capital for Clariant’s Healthcare Packaging business23 and IMM Private Equity’s US$1.2 billion purchase of certain assets of Linde in South Korea.24
Given the robustness of the private equity market as we enter 2020, we expect these groups to continue to play a critical role in chemicals M&A—providing capital, acquiring non-core or non-performing assets, and building companies through consolidation that will subsequently be sold to corporate acquirers.
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Figure 3: Global chemical M&A activity — private equity buyers (2010 to 2019)
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Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
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2020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by chemical sector
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Commodity chemicals Specialty chemicals Fertilizers andagricultural chemicals
Industrial gases Diversified chemicals
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Figure 4: Global chemical mergers and acquisitions by target sector (2010 to 2019)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
Global chemical mergers and acquisitions by target sector (2010 to 2019)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Commodity chemicals 356 376 350 340 383 372 382 387 348 359
Specialty chemicals 145 174 171 132 159 147 185 172 157 148
Fertilizers and agricultural chemicals
64 69 66 43 67 72 61 65 77 61
Industrial gases 9 12 14 16 15 14 13 10 9 11
Diversified chemicals 5 15 8 6 11 7 9 3 9 6
Total 579 646 609 537 635 612 650 637 600 585
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
Mergers and acquisitions activity by chemical sectorAs stated previously, M&A activity pulled back slightly in 2019, but still remained strong. Commodity chemical deal volumes increased slightly, but volumes for fertilizers and agricultural chemicals and specialty chemicals saw the largest decline. In addition to trade tensions, consolidation that has occurred in the fertilizer and agricultural sector likely contributed heavily to the declines. This section analyzes M&A activity in each chemical sector and highlights recent trends and transactions.
Commodity chemicals: Search for growth may drive stronger M&A activityAs Figure 4 shows, the volume of commodity chemicals transactions registered a modest uptick in 2019 over 2018; however, volumes are still slightly below the 2014 to 2017 period. During 2019, with one prominent exception (Saudi Aramco’s acquisition of a controlling interest in SABIC),25 the size of transactions in commodity chemicals did not exceed US$ 2.5 billion.
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2020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by chemical sector
As discussed in the 2019 Outlook, a large proportion of investment in commodity chemicals continues to go toward organic growth (e.g., new cracker and petrochemical complexes announced by BASF,26 LyondellBasell-Sinopec,27 and others).
Growth in demand for basic chemicals could shrink in 2019, as forecasts suggest slowed global economic growth.28 However, some commodity chemical companies might take the opportunity to use their cash flow for M&A as they seek growth in adjacent products and end markets.
Additionally, with more petrochemical capacity scheduled to come on line in 2020, the oversupply and depressed prices for some petrochemicals could worsen.29 As such, commodity chemical companies will likely spend much of 2020 focused on driving efficiencies rather than using M&A to add to capacity.
Intermediates and specialty materials: Significant transaction activity volumes and values to continueM&A activity in specialty chemicals appeared to pick up as 2019 progressed—although it ended the year with a six percent decrease in volume compared to 2018 (see Figure 4). Valuation multiples remained particularly strong as acquirors showed a willingness to pay premium multiples for unique, market-leading solutions and franchises.
Highlights of the year include:
• A continued focus on food flavorings and additives following last year’s US$7.1-billion acquisition of Frutarom by IFF30 with (1) the US$26.2 billion merger of IFF with DuPont Nutrition and Biosciences,31 (2) Archer Daniels Midland’s US$175 million acquisition of the Florida Chemical Company,32 and (3) a US$21 million acquisition by IFF of The Additive Advantage LLC.33
• The bidding war between Entegris and Merck for Versum.34
• BASF announcing two sizeable specialty chemical divestitures: Construction Chemicals and Pigments.35
• The implied 16.1x multiple paid by Nippon Paint Holdings to acquire DuluxGroup36 for US$3.1 billion as the large players in the coatings industry look to keep pace with many other rivals who have merged in recent years.
While many of the largest values were evident in acquisitions of standalone companies, activity in this sector continues to be driven by acquisitions of products being carved out of larger companies as they look to optimize their portfolios. The BASF examples above are among the largest, but other transactions include the carveout of Evonik’s Methacrylates business,37 and Clariant’s sale of its masterbatches business for US$1.5 billion.38 Portfolio optimization within the industry has been a continuing trend for many years, and with valuations for specialty chemicals often exceeding the value of the combined business, it can be expected that sellers will continue to look to monetize such assets in order to focus on core operations.
Fertilizers and agricultural chemicals: Trade tensions continue to depress cross-border dealsDeal activity in fertilizers and agchems was relatively muted in 2019, as we can see in Figure 4. None of the announced transactions in the sector crossed the US$1 billion threshold, with the year’s largest deal being Sumitomo Chemicals’ acquisition of Nufarm’s Latin American activities for US$802 million.39
The announced combination of ChemChina’s Syngenta and agricultural chemical businesses from Sinochem is in line to create another global powerhouse in 2020.40
The US market was impacted by a weak start to the year's growing season due to wet weather. Additionally, the ongoing trade dispute between the United States and China and weak agricultural commodity prices have put a damper on sector M&A activity, which is likely to continue into 2020. While there may be resolution in certain aspects of the ongoing trade dispute with a “Phase One” agreement between the United States and China announced in January 2020,41 it remains unclear whether this will have an immediate impact on demand or whether a return to the status quo will drive further consolidation in the sector.
Industrial gases: Asia may dominate gas deals in 2020Following last year’s divestitures coming out of the Linde/Praxair42 combination, 2019 industrial gas deal values were significantly lower than in the recent past, though deal volumes increased. In addition, most of the deal activity was focused on Asia. The largest deal of the year was the acquisition of certain Linde Korea assets by IMM Private Equity for US$1.2 billion.43
Given the low likelihood of additional large-scale consolidation in industrial gases, industry observers expect 2020 activity to be largely in line with 2019.
Diversified: Portfolio management driving M&ASimilar to 2018, the diversified chemicals space saw limited deal activity in 2019 (see Figure 4). The year ended with one sizeable announcement: Showa Denko’s tender offer for Hitachi Chemical for more than US$8 billion.44 Rather than acquiring companies, many of the larger diversified chemicals companies remain very active in pruning their portfolios; for example, BASF,45 Clariant,46 Dow Chemical,47 DuPont,48 and Evonik49 all sold, or initiated sales processes, for more than one business during the year, many of which were in the specialty chemical space. At the same time, except for smaller bolt-ons or technology plays, they were conspicuous by their absence from the list of acquirors in the sector.
The same level of activity could be evident again in 2020.
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2020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by geography
Figure 5: Global chemical merger and acquisitions activity by target market (2010 to 2019)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019United States 165 197 204 160 206 186 201 196 180 180
China 57 50 50 48 70 78 72 89 82 82
United Kingdom
35 29 37 27 35 33 41 33 29 30
Germany 37 28 44 37 44 37 38 41 28 40
India 17 27 10 20 17 23 28 15 28 21
Netherlands 14 11 14 6 8 11 19 8 21 9
Japan 11 20 15 14 15 20 12 11 15 14
Brazil 12 18 23 15 12 10 24 14 16 4
Other 231 266 212 210 228 214 215 230 201 205
Total 579 646 609 537 635 612 650 637 600 585
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
Mergers and acquisitions activity by geographyM&A activity remained strong in 2019. While the volumes of transactions have stayed relatively flat for most, excluding notable decreases in the Netherlands and Brazil, the US continues to lead in terms of value at $41 billion with Japan coming in second at $17 billion. There was a noticeable shift toward Asian markets in 2019. Despite the decrease in value in China, values in Japan, Australia and South Korea showed considerable increases.50 Volumes in these four countries remained flat or showed a slight increase to show strong growth overall in the region. European markets, however, remained relatively consistent with 2018 with strong growth in activity in Germany and Sweden50 (not shown on Figure 5) being offset by a slowing of transactions in other western European countries such as France50 (not shown in Figure 5), Italy50
(Not shown in Figure 5), and the Netherlands. South American activity continues to be led by Brazil, which pulled back in 2019 to its lowest level in the last 10 years.
United States: Momentum from the second half of 2019 to continue in 20202019 US chemicals M&A activity got off to a relatively slow start, driven
in part by factors evident toward the end of 2018, including interest rates that were comparatively higher than in the years immediately following the financial crisis, stock market volatility, and increasing trade tensions. Deal activity picked up as interest rates and the stock market moderated over the course of the year, or as investors chose to look past trade tensions. In fact, the last six months of 2019 saw approximately one third more
announcements of acquisitions of US chemicals companies than in the first half of the year.50
In comparison with the prior year, the total US deal volume was flat (as shown on Figure 5) thanks to a burst of transaction announcements in December, while the total value increased significantly due to the mega-merger of DuPont’s Nutrition and Biosciences business unit with IFF.51
Furthermore, the United States remains the most active market for M&A transactions and among the markets with most value transacted. Foreign buyers remain very interested in US assets, with European acquirers the most active. As for Asian buyers, similar to the recent past, Chinese inbound activity was extremely low in 2019.50 However, Japanese and Korean groups have been increasingly aggressive in pursuing American chemical assets.
Portfolio management remained an important theme for US chemicals companies, with several sizeable divestitures by the likes of Huntsman (Intermediates and Surfactants),52 Ashland (Composites and BDO),53 DuPont (Nutrition and Biosciences),54 and Ecolab (ChampionX)55 announced during the year. At the same time, strategics continued to acquire targets that bolstered their core business. Private equity groups remained important participants in the sector as both acquirers and sellers of businesses.
Given the current strength of the economy and stock market, one would anticipate continued strength in US chemicals M&A activity in 2020.
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2020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by geography
China: Domestic consolidation efforts will drive M&ADeal volumes were flat in 2019, while value decreased back down to 2017 levels after almost doubling from 2017 to 2018.
This dip is due to the absence of mega-deals in 2019. However, as expected, there was a number of smaller-sized deals as consolidation continued in China. For 2020, the impact of the US-China trade dispute and ongoing, though slightly less restrictive, capital controls in China will likely keep overseas acquisitions by Chinese buyers at continued low levels that may be comparable to 2019. M&A in the chemicals industry will remain a domestic play like in 2019, where over 70 percent of the deals were between domestic buyers and sellers. Inbound acquisitions by foreign buyers may increase for two reasons: 1) the consolidation in all Chinese chemicals sectors keeps momentum, and liquidity issues of small and mid-sized players creates opportunities; and 2) pricing levels for domestic IPOs, an important price guide for local sellers, are expected to remain at levels comparable to 2019. Acquisition opportunities in China in the chemicals industry will therefore not be cheap, but given the current adjustments in the Chinese economy, there may be additional opportunities for foreign buyers. Other than the announced merger of agricultural chemical assets of Sinochem and ChemChina,56 large deals are not likely as the industry is dominated by state-owned players, with typical deal sizes likely to be US$50–150 million for the majority of inbound transactions.
We do not note a trend toward any particular sector within chemicals, with consolidation taking place across all sectors. China is traditionally home to the world's largest base chemicals capacity, which drives activity levels. Recently there have been increasing price pressures from customers and cost pressures from increasingly strict environmental regulations. Domestic transactions are up more than 25 percent year over year, which is due, in part, to companies looking to gain scale to better leverage these higher regulatory compliance costs.
United Kingdom: Slight uptick in M&A as overseas inbound appetite remains strongAs Brexit uncertainty continued to weigh on business confidence, UK chemicals M&A activity was relatively flat compared to 2018, with both volumes and values up
just slightly. International interest in UK companies continued, with investors from France, Germany, and North American countries particularly active. As in 2018, the speciality space proved popular, especially companies serving the personal-care sector.
Corporates made up the majority of the acquirers, despite a strong global private equity market supported by cheap debt and record levels of dry powder. The number of private equity exits of UK companies also declined, potentially attributed to companies holding on to assets in the hope of an improved backdrop post-Brexit.
Outbound M&A from UK corporates was also in evidence, albeit at a much lower level than in 2018 with deal volumes dropping by more than 50 percent compared to the prior year, reflecting caution in the face of Brexit uncertainties. For those venturing abroad, strategies included expanding geographical footprints and increasing exposure to growth end-markets, accessing higher-margin products, and filling gaps in product portfolios.
As the industry moves into a period of potential uncertainty, continued caution toward M&A may be expected in the UK chemicals market. However, an uptick in carve-outs may be expected to continue as big players aim to become more and more focused, providing opportunities for purchasers of the non-core businesses. Furthermore, with debt still relatively cheap and both corporates and private equity having cash to deploy, conditions for UK M&A are expected to remain supportive into 2020, pending any impacts of a final Brexit agreement.
Germany: Trend toward differentiation to drive M&A activityDespite the increasing economic uncertainty and an automotive slowdown impacting demand within the chemicals industry, M&A transactions in the German
chemicals industry was up in 2019 versus 2018, in terms of both transaction value and volume. In addition to supportive economic conditions and debt markets, key drivers for the very solid activity level were mostly strategic considerations of the industry players, driven by trends such as globalization, digitalization, and increasing commoditization. Germany continues to be a significant player in the international deal space, second only to the United States in outbound cross-border deals.
As in the last few years, most transactions were driven by strategic players, pushing to improve or maintain their portfolio value—either by acquiring new capabilities or by divesting non-core assets. German chemical companies were mostly targeting innovative, differentiated technologies that will accelerate profit and growth in the years to come. One divestiture which is not focused on chemical production but is instead focused on the operation of chemical plants was the announced sale of Currenta, a chemical park operator, by shareholders Bayer and LANXESS to funds managed by Macquarie Infrastructure and Real Assets (MIRA) for US$3.9 billion.57 This highlights a growing trend by chemical firms to sell land and/or include the site services when carving out individual production units or plants from larger chemical complexes so that the proceeds can be invested in higher growth or value adding solutions. We have observed site services or operating agreements being a critical piece of negotiations for transactions involving chemical plants globally due to differing valuation multiples from the production multiples and potential volatility in earnings associated with site services.58
At the same time, businesses with an increased degree of commoditization were often divested by German strategic players. Those more commoditized businesses were mostly purchased by
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2020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by geography
global private equity companies—partly also by foreign strategic acquirers that want to build a globally leading market share (e.g., the pigments value chain). In addition, the Bayer-Monsanto transaction is still impacting the German market through continued divestitures.59
Going into 2020, one might expect that the growing uncertainty and the possible economic downturn could lead to a mild slowdown in M&A activity, especially as regulatory scrutiny has tightened significantly in Europe.
India: Slower growth may hinder M&A activity despite industry-friendly reforms and robust long-term growth outlookThe Indian economy’s growth rate declined slightly
from 6.8 percent GDP growth in 2018 to 6.1 percent in 2019, and is projected to grow at seven percent in 2020.60 With the ruling government gaining a clear majority in the central government elections, the Indian market expects faster reforms for growth and development supported by prevailing favorable macroeconomic conditions. India’s foreign exchange reserves grew to US$451 billion, compared to US$393 billion at the end of 2018,61 its ranking in the World Bank’s Ease of Doing Business ratings improved from 142 in 2014 to 63 in 2019,62 and inflation continues to be in control. India is also poised to become the world’s fifth-largest economy, with a GDP of US$2.93 trillion, having surpassed the United Kingdom and France in 2019.63
Chemicals M&A deal value in India rose by US$500 million in 2019, though deal volumes decreased by 25 percent as compared to 2018 as the economy’s growth rate began to slow. In the wake of the mild growth slowdown experienced in 2019, India announced industry-friendly reforms, including reducing corporate tax rates from 35 to 25 percent, and from 25 to 15 percent for new manufacturing companies, and liberalising guidelines for external commercial borrowing and foreign direct investment. India is also planning to make changes to its Petroleum, Chemicals, and Petrochemicals Investment Region (PCPIRs) policy to attract further investments. With the country’s growing population and increasing per-capita income, the chemical industry’s biggest advantage is the growing domestic consumption across all sub-sectors. Further to the cluster approach of the PCPIRs, which are attracting significant investments, the government has rolled out a scheme to establish Plastic Parks across the country.64 Plastic Parks would have common infrastructure to support plastic production plants and to ensure environmentally sustainable growth through innovative methods.
While domestic commodity players are looking to foray into specialty chemicals, many global players are evaluating acquisitions in India with a long-term objective; the agricultural chemicals sub-sector has matured quite well with almost 50 percent exports, and the fertilizers market is growing at a decent pace.50
Although the environment is conducive for chemical industry growth in India based on growing consumption, a stable government, tax and investment reforms, and chemical cluster
policies, the uncertainty surrounding the unanticipated economic slowdown in 2019 may delay the M&A deals in the pipeline, which may cause a slow start to activity in 2020 with increased activity only in the latter part of the year.
Netherlands: Macro conditions support growth in M&A volumesAfter the record year of 2018, chemical M&A activity in the Netherlands slowed down in 2019. The number
of deals dropped to nine (from 21), and the total value of these transactions was just over US$400 million, compared to US$14.7 billion in 2018, which was driven by two multi-billion-dollar deals.50 The largest transaction of 2019 was the acquisition of BRB International by Malaysia-based Petronas Chemicals for approximately US$182 million.65
The macro drivers for M&A activity in the Netherlands remain quite positive. However, despite a strong economic climate, relatively inexpensive debt, and increasing cash on hand, the market sentiment continues to be less than optimistic. A number of companies in Western Europe have had a disappointing 2019 in terms of growth and earnings, partly driven by a sluggish automotive sector and uncertainty around global trade. Additionally, the CO2-emission discussion became very vivid in the second half of 2019 and will likely continue in 2020. These factors may have a negative effect on the investment climate across many industries and in the chemical industry in particular. Further, these effects are not expected to go away soon and may dampen 2020 M&A activity.
Japan: High appetite for M&A despite an economic downturnIn 2019, many leading chemical companies in Japan experienced weaker results due to a variety of
negative factors, including an increase in trade tensions and tariff hikes between the United States and China, a decline in business confidence, and a tightening of monetary conditions, following 2018 when almost all major chemical companies enjoyed record earnings. Against this backdrop, Japan remained active in the M&A market. In fact, while deal volumes remained flat, values for acquisitions of Japanese targets increased to nearly US$17 billion as a result of two large domestic transactions.50 Outbound M&A was evident throughout the year with two deals over US$1 billion, reflecting the business-critical need to rapidly expand overseas to offset a declining domestic market. In addition, in this downturn, companies have a continuing need to accelerate portfolio transformation, which many businesses are currently tackling. Japan M&A activity levels will likely remain consistent in 2020, though deal values may slide back to historical levels.
Brazil: M&A activity growth expected in 2020Despite the overall growth in Brazilian M&A transactions in 2019,66 activity in the chemical sector fell below expectations for several reasons. First,
major acquisition deals did not go through, including the sales of Braskem67 and two agricultural chemical plants of Petrobras.68 Additionally, productivity stagnation, a trade balance deficit,
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2020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by geography
political uncertainty from delayed domestic reforms, and the Bolivian political crisis, which threatened the supply of natural gas for chemical feedstocks, all likely hindered M&A in Brazil’s chemical industry.
Nonetheless, there is reason to expect M&A growth in 2020. GDP growth is projected to be 2.2 percent,69 a 1.3-percentage-point increase from the previous year, which may translate into higher demand for chemicals and higher industrial productivity, impacting both profitability and attractiveness of chemical plants. Moreover, interest rates in Brazil have reached a historic low at 4.5 percent70 along with a currency that will probably remain depreciated71 relative to many key currencies, which may further stimulate investments and thus propel M&A activity.
Taking into consideration the privatization agenda undertaken by the Brazilian government and Petrobras’s divestment plan for 2019–2023, which includes downstream chemical assets,72 one may anticipate that the chemical industry will see relevant and valuable deals this year. Commodity chemicals as well as fertilizers and agricultural chemicals are likely to be the main targets within the industry. In addition, companies related to sustainable practices and innovation may be increasingly targeted, as seen in 2019 in the Raízen Energia (Cosan and Shell’s joint venture) acquisition of stakes from Cosan Biomass,73 a company dedicated to selling straw and bagasse from sugarcane for experiments, and in the takeover of a recycling plant by Globalpack, a major plastic packing solutions company.74
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2020 Global chemical industry mergers and acquisitions outlook | Summary outlook for 2020 mergers and acquisitions activity
Summary outlook for 2020 mergers and acquisitions activityDespite the recent modest dips in M&A volumes over the past few years, the chemical industry continues to enjoy robust M&A activity. Activity levels have remained strong through trade and geopolitical tension, economic uncertainty, and slowing growth rates. It appears that the industry has grown more comfortable operating in increasing uncertainty, and that the basic objectives of growth and profitability have gained importance—operating in an uncertain world is now the “new normal.”
While we have observed a re-direction of cash into new and more efficient capacity building, particularly in the United States to leverage advantaged shale gas feedstocks, allocating funds to execute strategy through M&A continues to be a priority for chemical industry players.
The global economy appears poised to support continued M&A activity. Though the World Bank trimmed its forecasts for 2019 and 2020 growth, it appears that improved growth is expected in 2020—2.5 percent globally.75 Geopolitical tensions and trade disagreements have continued to impede economic growth. The China/US trade dispute has taken its toll on growth in both
countries, but perhaps has benefitted other Asian countries that stepped in to fill the unmet needs resulting from trade differences.
The fundamentals for M&A activity in the chemical industry continue to be strong as well. Companies are searching for growth, a larger global footprint, a more focused or more cost-efficient operation, and innovative solutions. Shareholder activists continue to be a mainstay in the chemical industry and to spur activity by proposing changes to the business portfolio. Additionally, many sectors within the chemical industry remain fragmented, providing opportunities for consolidators to create value through M&A.
Over the past years, we have observed the chemical industry’s continued strength in M&A activity. We expect that 2020 will bring new opportunities and new challenges to the deal market. But barring a global geopolitical or economic event, chemical M&A activity may mimic that observed in 2019 with upside benefit if current trade and geopolitical tensions ease. Though obstacles continue to arise that might otherwise hamper M&A, the chemical industry continues to demonstrate that it has the strength to clear the hurdles.
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2020 Global chemical industry mergers and acquisitions outlook | Endnotes
Endnotes1 Paul Hannon, Tom Fairless, and Megumi Fujikawa, “Global
economic powerhouses stuck in low gear,” Wall Street Journal, November 14, 2019, https://www.wsj.com/articles/growth-in-economic-powerhouses-starts-to-diverge-11573730840.
2 Saudi Aramco, “Saudi Aramco signs share purchase agreement to acquire 70% majority stake in SABIC from the Public Investment Fund of Saudi Arabia,” March 27, 2019, https://www.saudiaramco.com/en/news-media/news/2019/aramco-sabic.
3 David Stanway, “Sinochem chairman says merger with ChemChina still underway,” Reuters, November 6, 2019, https://www.reuters.com/article/us-sinochem-chemchina-merger/sinochem-chairman-says-merger-with-chemchina-still-underway-idUSKBN1XG151.
4 Reuters, “ChemChina, Sinochem merge agricultural assets: Syngenta,” January 5, 2020, https://in.reuters.com/article/us-chemchina-sinochem-syngenta/chemchina-sinochem-merge-agricultural-assets-syngenta-idINKBN1Z40FZ.
5 Reuters, “LyondellBasell ends talks with Odebrecht to buy Braskem,” June 4, 2019, https://www.reuters.com/article/us-braskem-m-a-lyondell/lyondellbasell-ends-talks-with-odebrecht-to-buy-braskem-idUSKCN1T51BH.
6 Reuters, “CEO of Brazil's Petrobras objects to delay in Braskem sale,” December 6, 2019, https://in.reuters.com/article/petrobras-strategy-braskem-idINE5N27L010.
7 Jean-François Tremblay, “Chemicals are caught up in U.S.-China trade war,” Chemical & Engineering News, June 20, 2018, https://cen.acs.org/policy/trade/Chemicals-caught-US-China-trade/96/i26.
8 Will Beacham, “Saudi drone attacks threaten around 10% of global ethylene capacity,” Independent Commodity Intelligence Services (ICIS), September 16, 2019, https://www.icis.com/explore/resources/news/2019/09/16/10417877/saudi-drone-attacks-threaten-around-10-of-global-ethylene-capacity.
9 BBC News, “Election results 2019: Boris Johnson returns to power with big majority,” December 13, 2019, https://www.bbc.com/news/election-2019-50765773.
10 Devika Krishna Kumar, “Oil prices jump after U.S. air strike kills top Iranian commander,” January 2, 2020, https://www.reuters.com/article/us-global-oil/brent-jumps-nearly-3-after-u-s-air-strike-kills-iran-iraq-officials-idUSKBN1Z2030.
11 Saudi Aramco, “Saudi Aramco signs share purchase agreement to acquire 70% majority stake in SABIC from the
Public Investment Fund of Saudi Arabia,” March 27, 2019, https://www.saudiaramco.com/en/news-media/news/2019/aramco-sabic.
12 Alexander H. Tullo, “Why the future of oil is in chemicals, not fuels,” Chemical and Engineering News, February 20, 2019, https://cen.acs.org/business/petrochemicals/future-oil-chemicals-fuels/97/i8.
13 Joseph Chang, “CP Chem/NOVA talk underscores Big Oil's push,” Independent Commodity Intelligence Services (ICIS), July 8, 2019, https://www.icis.com/explore/resources/news/2019/06/27/10384296/cp-chem-nova-talk-underscores-big-oil-s-push.
14 Deloitte, 2019, https://www2.deloitte.com/us/en/pages/energy-and-resources/articles/oil-and-gas-industry-and-chemicals-industry-outlook.html.
15 LyondellBasell, “LyondellBasell and SUEZ collaborate with Samsonite to create recycled plastic suitcase collection,” April 19, 2019, https://www.lyondellbasell.com/en/news-events/corporate--financial-news/lyondellbasell-and-suez-collaborate-with-samsonite-to-create-recycled-plastic-suitcase-collection/.
16 Eastman, “Eastman to recycle discarded carpet into new materials,” November 5, 2019, https://www.eastman.com/Company/News_Center/2019/Pages/Eastman-to-recycle-discarded-carpet-into-new-materials.aspx.
17 Deloitte, 2019, https://www2.deloitte.com/content/dam/Deloitte/us/Documents/energy-resources/us-the-changing-single-use-plastics-landscape.pdf.
18 Clare Goldsberry, “Solid growth projected for recycled plastics market,” Plastics Today, January 9, 2020, https://www.plasticstoday.com/recycling/solid-growth-projected-recycled-plastics-market/54733249462196.
19 The Carlyle Group, “AkzoNobel closes sale of Specialty Chemicals to The Carlyle Group and GIC,” October 1 2018, https://www.carlyle.com/media-room/news-release-archive/akzonobel-closes-sale-specialty-chemicals-carlyle-group-and-gic.
20 Kate Rooney, “Private equity’s record $1.5 trillion cash pile comes with a new set of challenges,” CNBC, January 31, 2019, https://www.cnbc.com/2020/01/03/private-equitys-record-cash-pile-comes-with-a-new-set-of-challenges.html.
21 BASF, “Lone Star Funds to acquire BASF’s Construction Chemicals business,” December 21, 2019, https://www.basf.com/global/en/media/news-releases/2019/12/p-19-421.html.
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2020 Global chemical industry mergers and acquisitions outlook | Endnotes
22 Advent International, “Advent International acquires Evonik Industries’ methacrylates business,” March 4, 2019, https://www.adventinternational.com/advent-international-acquires-evonik-industries-methacrylates-business/.
23 Clariant, “Clariant signs an agreement regarding the sale of its healthcare packaging business," July 22, 2019, https://www.clariant.com/en/Corporate/News/2019/07/Clariant-signs-an-agreement-regarding-the-sale-of-its-Healthcare-Packaging-Business.
24 Linde, “Linde completes divestiture of selected Korean assets,” April 30, 2019, https://www.linde.com/en/news-media/press-releases/2019/linde-completes-divestiture-of-selected-korean-assets.
25 Saudi Aramco, “Saudi Aramco signs share purchase agreement to acquire 70% majority stake in SABIC from the Public Investment Fund of Saudi Arabia,” March 27, 2019, https://www.saudiaramco.com/en/news-media/news/2019/aramco-sabic.
26 BASF, “BASF and SINOPEC sign Memorandum of Understanding to expand cooperation in China,” October 29, 2018, https://www.basf.com/global/en/media/news-releases/2018/10/p-18-358.html.
27 LyondellBasell, "LyondellBasell and Sinopec announce joint venture to manufacture propylene oxide and styrene monomer in China," December 23, 2019, https://www.lyondellbasell.com/en/news-events/corporate--financial-news/lyondellbasell-and-sinopec-announce-joint-venture-to-manufacture-propylene-oxide-and-styrene-monomer-in-china/.
28 International Monetary Fund, “World economic outlook update, January 2019,” January 2019. https://www.imf.org/en/Publications/WEO/Issues/2019/01/11/weo-update-january-2019.
29 Will Beacham, “Global PE faces even more new capacity in 2020, oversupply, poor margins,” Independent Commodity Intelligence Services (ICIS), December 19, 2019, https://www.icis.com/explore/resources/news/2019/12/19/10454460/global-pe-faces-even-more-new-capacity-in-2020-oversupply-poor-margins.
30 International Flavors and Fragrances, “IFF’s Frutarom division completes acquisition 60% of Thailand-based Mighty, January 18, 2019, https://ir.iff.com/news-releases/news-release-details/iffs-frutarom-division-completes-acquisition-60-thailand-based.
31 Dupont, “IFF to Merge with DuPont’s Nutrition & Biosciences Business,” December 15, 2019, https://www.dupontnutritionandbiosciences.com/news/iff-to-merge-with-dupont-nutrition-biosciences-business.html.
32 ADM, “ADM adds industry-leading citrus capabilities to flavor portfolio with acquisition of Florida Chemical Company,” January 11, 2019, https://www.adm.com/news/news-releases/adm-adds-industry-leading-citrus-capabilities-to-flavor-portfolio-with-acquisition-of-florida-chemical-company.
33 IFF, “IFF acquires additive, advantage expands scent taste and actives,” February 19, 2019, https://ir.iff.com/news-releases/news-release-details/iff-acquires-additive-advantage-expands-scent-taste-and-actives.
34 Reuters, “Merck KGaA goes hostile in $5.9 billion Versum takeover battle,” March 26, 2019, https://www.reuters.com/article/us-versum-materials-m-a-merckkgaa-bid/merck-kgaa-goes-hostile-in-5-9-billion-versum-takeover-battle-idUSKCN1R714D.
35 BASF, “Lone Star Funds to acquire BASF’s Construction Chemicals business,” December 21, 2019, https://www.basf.com/global/en/media/news-releases/2019/12/p-19-421.html; and BASF, “DIC to acquire BASF’s global pigments business,” August 29, 2019, https://www.basf.com/global/en/media/news-releases/2019/08/p-19-312.html.
36 Dulux Group, “Dulux Group board unanimously recommends acquisition proposal,” April 17, 2019, http://www.duluxgroup.com.au/ArticleDocuments/10262/ASX%20announcement%20-%2017042019.pdf.aspx.
37 EVONIK, “Evonik closes sale of Methacrylates business,” August 1, 2019, https://corporate.evonik.com/en/media/press_releases/performance-materials/pages/article.aspx?articleId=109129.
38 “Clariant has agreed to sell its Masterbatches business for approx. USD 1.6 Billion,” December 19, 2019, https://www.clariant.com/en/Corporate/News/2019/12/Clariant-has-agreed-to-sell-its-Masterbatches-business-for-approx_-USD-1_6-billion.
39 Nufarm, “Sale of Nufarm South America to Sumitomo for $1,188 million,” September 30, 2019, https://nufarm.com/wp-content/uploads/2019/09/ASX-release_LATAM_final.pdf.
40 Reuters, “ChemChina, Sinochem merge agricultural assets: Syngenta,” January 5, 2020, https://in.reuters.com/article/us-chemchina-sinochem-syngenta/chemchina-sinochem-merge-agricultural-assets-syngenta-idINKBN1Z40FZ.
41 Bob Davis, Lingling Wei, and William Mauldin, “U.S., China sign deal easing trade tensions,” Wall Street Journal, January 16, 2020, https://www.wsj.com/articles/u-s-china-to-sign-deal-easing-trade-tensions-11579087018?mod=hp_lead_pos1.
42 Linde, "Business Combination Between Praxair and Linde AG Successfully Completed," October 31, 2018, https://www.linde.com/en/news-media/press-releases/2018/business-combination-between-praxair-and-linde-ag-successfully-completed.
19
2020 Global chemical industry mergers and acquisitions outlook | Endnotes
43 Linde, “Linde completes divestiture of selected Korean assets,” April 30, 2019, https://www.linde.com/en/news-media/press-releases/2019/linde-completes-divestiture-of-selected-korean-assets.
44 Yuki Furukawa and Takako Taniguchi, “Showa Denko Unveils $8.8 Billion Deal for Hitachi Chemical,” Bloomberg, December 17, 2019, https://www.bloomberg.com/news/articles/2019-12-18/showa-denko-unveils-8-8-billion-deal-to-buy-hitachi-chemical.
45 BASF, “Lone Star Funds to acquire BASF’s Construction Chemicals business,” December 21, 2019, https://www.basf.com/global/en/media/news-releases/2019/12/p-19-421.html; and BASF, “DIC to acquire BASF’s global pigments business,” August 29, 2019, https://www.basf.com/global/en/media/news-releases/2019/08/p-19-312.html.
46 Clariant, “Clariant has agreed to sell its Masterbatches business for approx. USD 1.6 Billion,” December 19, 2019, https://www.clariant.com/en/Corporate/News/2019/12/Clariant-has-agreed-to-sell-its-Masterbatches-business-for-approx_-USD-1_6-billion.
47 Trinseo, “Trinseo to acquire latex binders assets in Germany,” May 2, 2019, https://www.trinseo.com/News-And-Events/Trinseo-News/2019/May/Trinseo-to-Acquire-Latex-Binders-Assets-in-Germany; and Altivia, “Altivia acquires Dow’s acetone derivatives business,” August 13, 2019, https://www.altivia.com/pressroom/altivia-acquires-dow-s-acetone-derivatives-business-1-1.
48 Kiel Porter, Myriam Balezou, and Rick Clough, “Dupont is said to explore divestiture of transportation unit,” Bloomberg, November 7, 2019, https://www.bloomberg.com/news/articles/2019-11-07/dupont-is-said-to-explore-divestiture-of-transportation-unit; and Dupont, “IFF to Merge with DuPont’s Nutrition & Biosciences Business,” December 15, 2019, https://www.dupontnutritionandbiosciences.com/news/iff-to-merge-with-dupont-nutrition-biosciences-business.html.
49 EVONIK, “Evonik closes sale of Methacrylates business,” August 1, 2019, https://corporate.evonik.com/en/media/press_releases/performance-materials/pages/article.aspx?articleId=109129.
50 Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
51 Dupont, “IFF to Merge with DuPont’s Nutrition & Biosciences Business,” December 15, 2019, https://www.dupontnutritionandbiosciences.com/news/iff-to-merge-with-dupont-nutrition-biosciences-business.html.
52 Huntsman, “Huntsman Completes the Sale of its Chemical
Intermediates and Surfactants Businesses to Indorama Ventures for $2 Billion,” January 5, 2020, https://ir.huntsman.com/news-releases/detail/425/huntsman-completes-the-sale-of-its-chemical-intermediates.
53 Ashland Corporation, “Ashland signs definitive agreement to sell Composites business and butanediol facility in Marl, Germany, to INEOS Enterprises for $1.1 billion,” November 15, 2018, https://investor.ashland.com/news-releases/news-release-details/ashland-signs-definitive-agreement-sell-composites-business-and.
54 Dupont, “IFF to Merge with DuPont’s Nutrition & Biosciences Business,” December 15, 2019, https://www.dupontnutritionandbiosciences.com/news/iff-to-merge-with-dupont-nutrition-biosciences-business.html.
55 Ecolab, “Ecolab Announces Plan to Spin off Its Upstream Energy Business as an Independent Public Company; Expects Fourth Quarter 2018 Diluted EPS of $1.48, with Adjusted Diluted EPS of $1.54; Forecasts 10%-14% Full Year 2019 Adjusted EPS Growth,” February 4, 2019, https://www.ecolab.com/news/2019/02/ecolab-announces-plan-to-spin-off-its-upstream-energy-business-as-an-independent-public-company-exp.
56 Reuters, “ChemChina, Sinochem merge agricultural assets: Syngenta,” JAN 5, 2020, https://in.reuters.com/article/us-chemchina-sinochem-syngenta/chemchina-sinochem-merge-agricultural-assets-syngenta-idINKBN1Z40FZ.
57 Bayer, “Bayer completes sale of Currenta state to Macquarie Infrastructure and Real Assets, November 29, 2019, https://media.bayer.com/baynews/baynews.nsf/ID/Bayer-completes-sale-of-Currenta-stake-to-Macquarie-Infrastructure-and-Real-Assets.
58 Deloitte observation.
59 Bayer, “History of Bayer 2010–2018,” 2018, https://www.bayer.com/en/2010-2018.aspx.
60 International Monetary Fund, “More fiscal transparency would mean better economic policy in India,” December 23, 2019, https://www.imf.org/en/News/Articles/2019/12/12/na121219-more-fiscal-transparency-would-mean-better-economic-policy-in-india.
61 Reserve Bank of India, “Weekly Statistical Supplement,” Accessed in December 2019, https://m.rbi.org.in/Scripts/WSSViewDetail.aspx?TYPE=Section&PARAM1=2.
62 “India ranks 63 in World Bank’s Doing Business Report: India improves rank by 14 positions,” Government of India Department for Promotion of Industry and Internal Trade, October 24, 2019, https://dipp.gov.in/sites/default/files/Press_Release_Doing_Business_Report_2020_dated_24102019.pdf.
20
2020 Global chemical industry mergers and acquisitions outlook | Endnotes
63 IMF World Economic Outlook October 2019, “Projected GDP ranking (2019–2024),” Statistics Times, November 13, 2019, http://statisticstimes.com/economy/projected-world-gdp-ranking.php.
64 NDTV, “10 New Plastic Parks To Boost Domestic Production: Ministry,” September 15, 2016, https://www.ndtv.com/india-news/10-new-plastic-parks-to-boost-domestic-production-ministry-1459253.
65 BRB, “PCG Completes Acquisition of Da Vinci Group B.V," September 12th, 2019, https://www.brb-international.com/news/2019/09/pcg-completes-acquisition-of-da-vinci-group-bv .
66 Cristiane Lucchesi and Pablo Rosendo Gonzalez, “‘Silent revolution’ to fuel Brazil M&A business for years, ” Bloomberg News, August 19, 2019, https://www.bloomberg.com/news/articles/2019-08-19/-silent-revolution-seen-fueling-brazil-m-a-business-for-years.
67 LyondellBasell ends talks with Odebrecht to buy Braskem https://www.reuters.com/article/us-braskem-m-a-lyondell/lyondellbasell-ends-talks-with-odebrecht-to-buy-braskem-idUSKCN1T51BH.
68 Raquel Brandao, “Petrobras does not reach agreement to sell fertilizer units,” Valor, November 26, 2019, https://valor.globo.com/empresas/noticia/2019/11/26/petrobras-no-chega-a-acordo-para-venda-de-unidades-de-fertilizantes.ghtml.
69 Kelly Oliveira, “Mercado eleva projeção de inflação e de crescimento econômico,” Agência Brasil, November 25, 2019, http://agenciabrasil.ebc.com.br/economia/noticia/2019-11/mercado-eleva-projecao-de-inflacao-e-de-crescimento-economico.
70 Banco Central Do Brasil, “Interest rates in Brazil,” Accessed in December 2019, https://www.bcb.gov.br/en.
71 Kelly Oliveira, “Mercado eleva projeção de inflação e de crescimento econômico,” Agência Brasil, November 25, 2019, http://agenciabrasil.ebc.com.br/economia/noticia/2019-11/mercado-eleva-projecao-de-inflacao-e-de-crescimento-economico.
72 Petrobras, “Divulgamos nosso plano estratégico e de negócios com nova métrica de topo,” December 5, 2018, http://www.petrobras.com.br/fatos-e-dados/divulgamos-nosso-plano-estrategico-e-de-negocios-com-nova-metrica-de-topo.htm.
73 Reuters, “Brazil antitrust agency clears Raizen Energia purchase of Cosan Biomassa,” October 29, 2019, https://www.reuters.com/article/us-brazil-energy-takeover/brazil-antitrust-agency-clears-raizen-energia-purchase-of-cosan-biomassa-idUSKBN1X81JB.
74 TTR, “Globalpack wins Repet Nordeste at auction,” September 18, 2019, https://www.ttrecord.com/en/exclusive-area/transactions/mergers-and-acquisitions/Repet-Nordeste-Reciclagem/276350/.
75 David Lawder, “World Bank trims 2020 growth forecast amid slow recovery for trade, investment,” Reuters, January 8, 2020, https://www.reuters.com/article/us-worldbank-economy-idUSKBN1Z72UA.
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2020 Global chemical industry mergers and acquisitions outlook | Contacts
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Contacts
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22
2020 Global chemical industry mergers and acquisitions outlook | Contacts
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2020 Global chemical industry mergers and acquisitions outlook | Contacts
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2020 Global chemical industry mergers and acquisitions outlook | Contacts
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25
2020 Global chemical industry mergers and acquisitions outlook | Acknowledgements
AcknowledgementsThe following are recognized for their strong contributions to this outlook: Alicia Keas with Deloitte & Touche LLP and John Forster from Deloitte Services LP.
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