Ingredients manufacturer M&A activity in 2016

Ingredients manufacturer M&A activity in 2016

It has been a big year for merger and acquisition activity among some of the biggest players in the fine chemical and ingredients supplier segment.

Businesses with either natural and organic ingredient capabilities or specialisation in high technology areas such as active ingredients are what the bigger players are all looking out for as they seek to increase both their portfolios and global reach.

Here we look at some of the most significant deals in the sector and consider the impact that they may have on the industry.

Dow-Dupont merger still on hold

http://www.cosmeticsdesign.com/Business-Financial/Dow-DuPont-merger-on-course

Back in March it was announced that the two US chemical corporations had jointly filed a preliminary registration statement with the Securities and Exchange Commission, outlining plans for leadership, work streams, synergies, and finance.

However, back in November, the EU announced that it was still investigating the deal, sighting, with the filing of formal objections set to delay the merger yet further.

DowDuPont, as the combined company says it wants the new entity to be called, signed a merger deal at the end of 2015.  Reporting on the eminent transaction, Cosmetics Design affirmed that “the consolidation of these US chemical corporations will be a game changer for the personal care and cosmetics industries and have staggering economic implications on a regional, national, and global scale.”

Evonik expands with Silicones acquisition

In a deal announced earlier this month, specialty chemical company Evonik has acquired the J.M. Huber silica business for more than $600m. It’s a transaction that will up the company’s position as a supplier of silica for many industries, not the least of which is cosmetics.

With the business, Evonik stands to gain larger market share in both the US and Asia as well as the strategic abilities to grow the company’s silica portfolio, according to a press release about the acquisition.

J.M. Huber wasn’t necessarily looking to sell: “The silica business has been part of Huber since the 1950s and paved the way for our company’s global expansion into engineered materials,” Mike Marberry, president and CEO of Huber, points out in the release. “While it is difficult to part with a longstanding business, we see Evonik as an excellent strategic fit for both our silica customers and employees,” he says.

The Huber Corporation has been operating in the US since 1883. Close to 700 people are employed at Huber Silica alone, with nearly 4,000 employees working for the full company in countries around the globe.

Solabia invests in Algae

In November the ingredients manufacturer Solabia announced the acquisition of a France-based company that specialises in biosphere-sourced materials.

Algues & Mer, headquartered in Brittany, France, is “especially notable” in the development of different active molecules for use in cosmetics, nutrition products and pharmaceuticals.

It is based on the island of Ouessant, a classified biosphere reserve of the Iroise Sea by UNESCO. According to Solabia, the site contains “a variety of both wild and cultivated algae, far removed from pesticides, heavy metals and pollution”.

Greentech expands into Brazil with Mapric buy

GreenTech, a French biotechnology company that makes ingredients for the personal care and cosmetics industry is, with this latest deal, jockeying to become a prominent global supplier for beauty.

The biotech firm has been gaining a foothold in the global market. And, the acquisition of Brazil-based Mapric strengthens the company’s position in that country and in the larger cosmetics actives market. “The two companies’ synergistic know-how will strengthen R&D, production capacities, sales teams and local and international partnerships,” says GreenTech in a media release about the acquisition.

Using the biotechnology of plants, GreenTech makes active ingredients “from plant, marine and microbial worlds,” according to the company site. Their cosmetics ingredient portfolio spans skin care, anti-aging, body care, hair care, and more.

BRB acquired by investment firm

Back in May, leading Netherlands-based silicones player BRB was acquired through a majority stake acquisition by investment firm Bencis Capital Partners.

The Bencis Buyout Fund IV, which is managed by Bencis Capital Partners, has acquired the stake in BRB Holding’s global production of silicones, lube oil additives and chemicals.

The aim of the acquisition is to tap into the additional investment resources of Bencis Captial in an effort to expand the global footing and industry reach of BRB.

In recent years the company has been investing in production facilities in Southeast Asia, in turn expanding its footing in the market for silicones used in a wide variety of cosmetic and personal care formulations.

Clariant buys stake in Korean ingredients player

And in April global specialty chemiclas player Clariant purchased a 17% stake in naturals active ingredients supplier BioSpectrum.

The move sees Clariant take up the role of ‘anchor shareholder’ and exclusive global distributor for the Korean ingredients supplier, with the strategic partnership set to“combine Biospectrum’s research strengths with Clariant’s formulations expertise and global presence”, according to the companies.

BioSpectrum derives many of its specialty active ingredients from Asia’s native flora, making it a key player in both the rising global market of Korean beauty and that of naturals cosmetics.

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