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PRIVATE EQUITY INVESTING
In Specialty Chemicals Companies

Thu, Oct 24 @ 8:00 am - 5:00 pm

Deal Making in Specialty Chemicals Continues to Set the Bar Higher & Higher

Private Equity Investing in Specialty Chemicals Companies

Details

Valuations of specialty chemicals companies are soaring to record levels, and private equity investors aren’t tamping down their acquisition pace.

Combined with the late-cycle economic environment and a private equity market flush with cash, it’s no wonder PE investors continue to deploy capital.

According to ThomasNet, more than 10,000 American businesses produce over 70,000 chemical products.

Those include an enormous “laundry list” of specialty chemicals such as adhesives, polymers, polymer additives, coatings, coating additives, lubricants, food additives, resins, and countless others that offer significant potential for private equity investors.

And PE investors are willing and able to pay a premium for these companies. Deal multiples are already one to two turns higher than standard valuations.  As a result, investors are asking themselves two questions — how much higher will valuations go, and how long can these elevated values persist?

In the face of such a high price environment, private equity investors are emphasizing –

  • Buy & build strategies, e.g., Huron Capital’s creation of platform Brudner Polymer last year.
  • Carve outs, e.g., the recent sale by AkzoNobel of its specialty chemicals business to the Carlyle Group and GIC.
  • Growth, e.g., Jordan Company’s acquisition of Dubois Chemicals.

There are also specific submarkets where deal activity is particularly buoyant —

  • Adhesives & sealants –  One third of the $50 billion global adhesives market is controlled by five large companies, but the remaining two-thirds consists of hundreds of small- and medium-sized companies; thereby creating a huge pool of attractive acquisition candidates for private equity investors such as Arsenal Capital’s Meridian Adhesives Group which was recently formed and has already acquired 5 adhesives companies.
  • Industrial coatings — The $25-30 billion industrial coatings market is projected to grow 5.4 percent annually through 2020, spurring an increased level of platform activity by private equity buyers who are aggressively pursuing bolt-on acquisitions. High Road Capital Partners’ portfolio company — U-C Coatings — recently acquired Contechem. The combined companies now provide complementary products for protecting freshly cut lumber and logs.
  • Chemical distribution — Gross margins for distributors of specialty chemicals are significantly higher than those of commodity chemicals — as much as 40% for complex chemicals like pharmaceutical additives. Distributors also play a critical role in the supply chain, which makes them top targets for private equity investors.  Look at Azelis, which EQT and Canada’s Public Sector Pension Investment Board acquired in 2018, and recently added on Chemroy Canada Holdings, an Ontario-based specialty chemicals, plastics, and food ingredients distributor.

But elevated valuations are not the only hurdle facing investors in specialty chemicals.

With the Trump administration waging trade wars on key partner countries, the focus on trade tariffs and how they are affecting specialty chemicals, imports and exports, and the supply chain in the sector, is higher than ever.

In a statement released by the Society of Chemical Manufacturers & Affiliates (SOCMA), it’s estimated that the Trump administration’s early May decision to raise tariffs to 25 percent on $200 billion in Chinese imports will disproportionately burden specialty chemical manufacturers. In many cases, China is the sole supplier of the raw materials and “building block chemicals” that specialty chemical supply chains depend on.

Chaired by

Brian Orkin, Arsenal Partners

Brian Orkin

Investment Partner
Arsenal Capital Partners

Date

Thursday, October 24, 2019

8:00am – 5:00pm

Location

Midtown Manhattan, NY

Marquee Sponsor

Benesch Logo

Showcase Sponsor

datacor_company_logo

Register now to gain valuable insights as 20-plus speakers
assess the outlook
for private equity investing in specialty chemicals
at
The Capital Roundtable’s all-day conference
on
Thursday, October 24, in Midtown New York City.

Key Reasons to Attend

Three Key Reasons Why You Should Join Us

 

  1. Understand how strategic investors and family offices are driving up valuations of specialty chemicals companies.
  2. Hear the latest developments and investment opportunities in the CASE (coatings, adhesives, sealants, and elastomers) sector.
  3. As class-action lawsuits increase in the industry, find out how to keep litigation risk at bay.
Key Points Being Covered
  • What are the most attractive segments in specialty chemicals?
  • Which segments of the market have reached high levels of consolidation?
  • How will an economic downturn affect the specialty chemicals industry?
  • What are the keys to enhancing value and increasing exit multiples in specialty chemicals?
  • How valuable are operating partners in growing and improving specialty chemicals portfolio companies?
  • What are the best exit routes for specialty chemicals companies?
  • What does the renewed negative attention to the plastics industry and plastic waste mean for investors?
  • What are the best strategies to invest in biopolymer and other sustainable materials?
Recent Deals

Recent Middle-Market Specialty Chemicals Deals

  • In November 2018, One Equity Partners said it would sell PeroxyChem, a manufacturer of peroxygen chemistries, to German Evomik Industries AG, a publicly-traded global specialty company, for $625 million.
  • In April, Vantage Specialty Chemical Holdings, a portfolio company of H.I.G. Capital, agreed to acquire Spain-based Textron, a provider of natural oils for the personal care, food, and chemical industries.
  • Avantor, the successor to Covidien’s specialty chemicals arm, acquired by New Mountain Capital in 2010 for $280 million, and completed a $3.8 billion IPO in May.
  • In the spring, Golden Gate Capital sold ArrMaz, which produces specialty chemicals for the mining, crop nutrients, and asphalt paving industries, to Arkema Group for about $570 million.
  • A consortium led by KKR acquired Taipei-listed LCY Chemical Corp., which produces specialty chemicals with a concentration on thermoplastic elastomers and performance plastic, in a $1.56 billion stock deal.
  • Comvest Partners acquired VanDeMark Chemical in April, 2019
Chairperson Info

Brian Orkin is an investment partner at Arsenal Capital Partners where his responsibilities include investment strategy development, deal origination, and transaction execution as a member of the fund’s specialty industrials team.

Prior to joining Arsenal in 2010, Mr. Orkin was a principal at The Anderson Group LLC, a private equity investment firm focusing on buyouts and control investments in lower middle-market manufacturing, distribution, and service businesses.  Prior to joining The Anderson Group LLC, he co-founded a bank holding company which acquired a national bank in Florida.  Mr. Orkin started his career as a corporate finance attorney with law firms in California and Pennsylvania.

Mr. Orkin earned a JD from California Western School of Law, an MBA from the executive program at the University of Pittsburgh, and a BA from the University of Michigan.

Who We Are

This Capital Roundtable conference in midtown, New York City, is all-business, all-targeted, all-designed to be a completely focused day of practical information and revealing insights about specialty chemicals companies. You’ll gain valuable insights from —

  • Three informative panel discussions
  • Two revealing keynote presentations
  • Real-world perspectives from company investors
  • Industry outlooks from noted sector experts
  • War stories and lessons learned from experienced hands

Chaired by
  •  Brian Orkin, Investment Partner, Arsenal Capital Partners
Hosted by
  • Burt Alimansky, Chairman & CEO, The Capital Roundtable
Preliminary Speaker List
  • Robert Haswell, Partner, Dominus Capital LP
  • Andrew Hinz, Managing Director, Grace Matthews Inc.
  • James A. Holmes, Managing Director & Head–Chemicals, FMI Corporation
  • Adam Hunia, Director, Lincoln International LLC
  • Rahul Katoria, Executive Director, Moelis & Co.
  • Timothy Knight, Board Member, Meridian Adhesives Group LLC
  • Derek McNulty, Managing Director, Jefferies LLC
  • Ryan J. Meany, Managing Partner, Edgewater Capital Partners LP
  • Kevin D. Margolis, Partner, Benesch LLP
  • Federico G.M. Mennella, Managing Dir. & Head–Chemicals & Materials, Rothschild & Co.
  • Cameron Morris, Dir.–Industrials, William Blair & Co. LLC
  • Brad Morrison, Director, Harris Williams & Company
  • Chris Mudd, Chief Executive Officer, Juniper Specialty Products & SGCE
  • Jared Mudge, Director, Valence Group LLC
  • Daniel Pelton, Chief Executive Officer, Meridian Adhesives Group LLC
  • James Reilly, Director, Lazard Middle Market LLC
  • Ed Rose, Senior Partner, Mill Rock Capital
  • David Ruf, Managing Dir. & Head–Chemicals & Materials, KeyBanc Capital Markets Inc.
  • Roy Seroussi, Investment Partner, Arsenal Capital
  • James F. Ward, Managing Director, Artemis Capital Partners LP
  • Scott Wolff, Managing Director, American Securities
  • Michael Zukas, Vice President, Huron Capital
7:30am – 8:30am

Networking & Registration & Breakfast

8:30am – 9:00am

Welcoming Remarks & Audience Self-Introductions

9:00am – 9:30am

Conference Chair’s Introduction —

  • Brian Orkin, Arsenal Capital Partners
9:30am – 10:30am

First Panel
What’s on the Horizon for Specialty Chemicals? What Are Buyers & Sellers Looking for?

10:30am – 11:15am

Networking & Coffee

11:15am – 12:00pm

Morning Conversation —
Catalysts for Change — Trade Disputes, Evolving ESG Standards and the Steady March Toward Sustainability

12:00pm – 1:00pm

Networking & Luncheon

1:00pm – 1:30pm

Keynote Interview —
James Reilly of Lazard Middle Market will interview Daniel Pelton of Meridien Adhesives Group

1:30pm – 2:30pm

Second Panel
Driving Performance — Operational Strategies that Enhance Value

2:30pm – 2:45pm

Networking & Dessert

2:45pm – 3:30pm

Afternoon Conversation
PE Investment Strategies that Yielded Great Result — Buy & Build, Carve-outs, Restructurings, & Other Alternatives

3:30pm – 4:30pm

Third Panel —
The Value Creation Challenge — Driving Your Exit Strategy from the Inception of the Deal

4:30pm

Networking & Adjournment

Space at this conference is limited, so register as soon as possible to assure yourself a seat. To avoid disappointment, please contact Chris Agar today to confirm your attendance at 212-832-7300 ext. 0 or cagar@capitalroundtable.com.

Please note that Capital Roundtable limits the number of registrants from a single firm to three.

Best Rate – Early Registration

Save $300 off the standard fee of $1,495 when you register by Friday, September 6. Just $1,195.

Incentive Registration

Save $200 of the standard fee! Register by Friday, September 27, and the fee for the conference is $1,295.

Conference Rate

$1,495 increasing to $1,595 day of conference, space permitting.

Group Rate

$1095 each until Friday, September 27, when you register two or more people to attend from the same company. This rate increases to $1295 each after Friday, September 27.

You can pay by credit card (using the links above or below) or by check. Mail your check and business card to: New York Business Roundtable Inc., 747 Third Avenue, Suite 200, New York, NY 10017.

Can’t attend but want to hear the program? You can buy the audio package along with the handounts.

This event is sponsored by:

Marquee Sponsor:

Benesch Logo

Showcase Sponsor:

datacor_company_logo

Association Partners:

Data Partners:

Past Attendees 

Alliance Holdings

Alvarez & Marsal Holdings

Balmoral Advisors

Blaige & Co.

BlueArc Capital Partners

Carter Morse & Mathias

CCMP Capital Advisors

Centripetal Capital Partners

Chemtura Corp.

Clariant Corp.

Courtney Group

Credit Suisse Securities

CVC Capital Partners Advisory

Dominus Capital

Dominus Capital

DowDuPont Inc.

Edgewater Capital Partners

FTI Consulting

Grace Matthews

Gryphon Investors

H.I.G. Capital

Harris Williams

Harvest Partners

High Road Capital Partners

Hilltop Private Capital

Houlihan Lokey

Huron Capital Partners

Ironwood Capital

JLL Partners

JM Search

Jordan Co.

Korn Ferry

Lazard Middle Market

Lincoln International

Lion Chemical Partners

Long Point Capital Inc.

Macquarie Capital

Mill Rock Capital Management

Mitsubishi Chemical Holdings America

Newry Corp.

Odyssey Investment Partners

OMERS Private Equity

One Rock Capital Partners

Perella Weinberg Partners

Piper Jaffray

Plante Moran

Platte River Equity

Post Capital Partners

PricewaterhouseCoopers

Quad-C Management

Rothschild & Co.

Seaport Global Securities

Sidereal Capital Group

Silver Leaf Partners

Society of Chemical Manufacturers & Affiliates

Solenis

Stifel Financial Corp.

Thompson Hine

TorQuest Partners

Valufinder Group

Vantage Specialty Chemicals

Young & Partners

Contact Us



747 Third Avenue | Suite 200 | New York City | 10017
212-832-7300

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