Specialty Chemicals Review - Oracle · 2017-01-26 · analysis of any security, issuer, or industry and is not an offer or a solicitation of an offer to buy or sell any securities

U.S. Specialty Chemical Market Outlook

According to the American Chemistry Council, U.S. specialty chemical market volumes grew 0.4% in November compared to gains of

0.1% in October and 0.2% in September. Volumes have been steadily increasing since May 2016. The overall specialty chemicals

volume index contracted 0.7% versus the prior year. The American Chemistry Council equates the decline year over year to the

downturn in the oil and gas sector that has spread throughout the industry. Despite the near-term softness, production is expected to

experience stable growth due to favorable dynamics in end markets and the general economy in 2017.

Chemical M&A Outlook

According to ICIS, global chemical M&A activity is expected to be robust throughout 2017 highlighted by many announced mega-mergers

spilling into 2017 and plenty of M&A activity in the middle market. Strategics continue to seek acquisitions to supplement the lack of

organic growth within the industry. Private equity firms remained relatively quiet until the end of 2016, and ICIS believes large sponsors

are making a renewed push into the chemicals industry. A couple notable sponsor deals over $1 billion occurred in the second half of

2016 including The Blackstone Group acquiring Acetow and Carlyle acquiring Atotech. As the financing market remains cheap, private

equity firms will continue to seek out attractive assets in the industry.

Mergers & Acquisitions and Capital Markets Update (see pg. 3-13)

On December 15, Lonza Group agreed to acquire Capsugel, the Morristown, New Jersey-based developer of dosage forms and

solutions for the healthcare industry from KKR for $5.5 billion (5.1x LTM 9/30/2016 sales and 15.1x LTM 9/30/2016 EBITDA)

On December 14, Schweitzer-Mauduit agreed to acquire Conwed Plastics, the Minneapolis, Minnesota-based manufacturer of plastic

netting and other plastic products, from Leucadia National Corp. for $335 million (2.4x 2016E sales and 12.0x 2016E EBITDA)

On December 9, Evonik agreed to acquire the Silica Business of J.M. Huber, a manufacturer of specialty engineered inorganic

materials for the industrial and paper industry for $630 million (2.1x 2016E sales and 10.5x 2016E EBITDA)

On December 7, The Blackstone Group agreed to acquire Acetow, the German-based manufacturer of cellulose acetate for cigarette

filters and supplies cellulose acetate flakes from Solvay SA for $1.1 billion (1.9x 2015 sales and 7.0x 2015 EBITDA)

On October 31, HollyFrontier agreed to acquire Petro-Canada Lubricants, the Canadian-based developer, producer and distributor of

lubricants, specialty fluids and greases from Suncor Energy for $840 million (5.6x LTM 6/30/2016 EBITDA)

On October 31, DyStar acquired the Emerald Specialties business of Emerald Performance Materials. KeyBanc served as the

exclusive sell-side advisor to Emerald Performance Materials

On October 5, American Securities agreed to acquire Chromaflo Technologies, the Ashtabula, Ohio-based manufacturer of chemical

and pigment dispersions for architectural and industrial coatings and thermoset composites markets, from Arsenal Capital Partners

and Nordic Capital. KeyBanc served as the sell-side advisor to Chromaflo

Source: Company Filings, Press Releases, IHS Chemical Week, ICIS, Plastic News, American Chemistry Council

Markets Update (see pg. 16)

The KeyBanc Capital Markets’ (“KBCM”) Specialty Chemicals Index rose 1.9% in Q4’16, compared to a 3.6% increase in the S&P

500. The Chemical Index is up 15.6% over the last year vs. a 11.2% increase for the S&P 500.

1

Disclosure: KeyBanc Capital Markets is a trade name under which corporate and investment banking products and services of KeyCorp and its subsidiaries, KeyBanc Capital Markets Inc., Member

NYSE/FINRA/SIPC, and KeyBank National Association (“KeyBank N.A.”), are marketed. Securities products and services are offered by KeyBanc Capital Markets Inc. and its licensed securities

representatives, who may also be employees of KeyBank N.A. Banking products and services are offered by KeyBank N.A. This report was not issued by our research department. The information

contained in this report has been obtained from sources deemed to be reliable but is not represented to be complete, and it should not be relied upon as such. This report does not purport to be a complete

analysis of any security, issuer, or industry and is not an offer or a solicitation of an offer to buy or sell any securities. This report is prepared for general information purposes only and does not consider the

specific investment objectives, financial situation and particular needs of any individual person or entity.

Specialty Chemicals Review

2

Source: Bloomberg

Natural Resources

$0.5

$0.9

$1.3

$1.7

$2.1

$2.5

Dec-15 Mar-16 Jun-16 Sep-16 Dec-16

US

$ /

MT

Palm Oil (Rotterdam) Nat. Rubber (Singapore)

N A T . R ESOUR C ES P alm Oil N at. R ubber

End of M onth Price $1.75 $1.03

M oM % Change 9.5% 11.2%

YoY % Change 38.5% 88.8%

EN ER GY C rude Oil N atural Gas


M oM % Change 18.8% 21.3%

YoY % Change 45.9% 76.7%

$0.0

$1.2

$2.4

$3.6

$4.8

$6.0

$0

$25

$50

$75

$100

$125


US

$ / M

MB

tuUS

$ /

bb

l

Crude Oil (WTI) Nat. Gas (Henry Hub)

Natural Resources

Petrochemicals (Gulf Coast)

OLEF IN S Ethylene P ro pylene


M oM % Change 12.8% 0.0%

YoY % Change 43.2% (10.8%)

$0.0

$0.2

$0.4

$0.6

$0.8


US

$ /

lb

Ethylene Propylene

$0.0

$0.2

$0.4

$0.6

$0.8

$1.0

$0.0

$1.0

$2.0

$3.0


US

$ / lb

US

$ /

ga

l

Benzene Toluene Styrene

A R OM A T IC S B enzene T o luene Styrene

End of M onth Price $2.73 $2.42 $0.52

M oM % Change 15.2% 18.7% 1.8%

YoY % Change 28.2% 17.5% 39.1%

$0.6

$0.8

$1.0

$1.2

$1.4

$1.6

Dec-14 Jun-15 Dec-15 Jun-16 Dec-16

US

$ /

lb

PP PS PVC

P LA ST IC S P P P S P VC

End of M onth Price $0.63 $1.05 $0.77

YoY % Change (31.5%) (9.5%) (30.1%)

2-Year % Change (44.2%) (21.1%) (33.2%)

$0.4

$0.6

$0.8

$1.0

$1.2

Dec-14 Jun-15 Dec-15 Jun-16 Dec-16

US

$ /

lb

HDPE LDPE

P LA ST IC S H D P E LD P E


YoY % Change (21.7%) (19.4%)

2-Year % Change (34.4%) (31.3%)

Plastics

Raw Material Price Trends (Through December 31, 2016)

3

Source: Company Filings, Press Releases, ChemWeek, Capital IQ

Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

Pending

(12/27/2016)

GlyEco, Inc. WEBA Technology

Corp and Recovery

Solutions &

Technologies Inc.

GlyEco, Inc. agreed to acquire WEBA Technology, the Madison, Wisconsin-based

manufacturer of additive packages for the antifreeze, gas patch coolants and heat

transfer industries, and Recovery Solutions & Technologies, the Phoenix, Arizona-

based producer of ethylene glycol

The acquisition will strengthen GlyEco’s strategy to continue to develop its ethylene

glycol production and expand its customer base

1/3/2017

(12/27/2016)

Recovery

Solutions &

Technologies Inc.

(GlyEco, Inc.)

Glycol Distillation

Assets of Union

Carbide

Corporation

(The Dow Chemical

Company)

Recovery Solutions & Technologies acquired Glycol distillation assets from Union

Carbide

The acquisition increases Recovery Solutions & Technologies’ manufacturing

capabilities and presence in the United States

12/27/2016

(12/27/2016)

Ennis-Flint Inc.

(Olympus

Partners)

American Traffic

Products, Inc. Ennis-Flint acquired American Traffic Products, the Rialto, California-based

manufacturer of traffic paints and thermoplastics

The acquisition expands Ennis-Flint’s capability and reliability to deliver quality

products and support to its customers

Pending

(12/22/2016)

Nippon Paint

Holdings Co.,

Ltd.

Dunn-Edwards

Corporation Nippon Paint agreed to acquire Dunn-Edwards, the Los Angeles, California-based

manufacturer of paints, painting and equipment to painting contractors, architects

and designers, government agencies and dealers

The acquisition will broaden Nippon Paint’s presence in the paint manufacturing

market

Dunn-Edwards generated 2015 sales of approximately $350 million

Pending

(12/21/2016)

RPM

International Inc.

SPS B.V. RPM agreed to acquire SPS, the Netherlands-based manufacturer of paint systems,

wall paints and decorative plasters

The acquisition will enable RPM to leverage the manufacturing and distribution

strengths of SPS to accelerate growth in Europe

Pending

(12/19/2016)

CCL Industries

Inc.

Innovia Group

(Altamar Private

Equity, Epiris LLP

and Smithfield

Group LLP)

CCL agreed to acquire Innovia Group, the U.K.-based manufacturer of biaxially

oriented polypropylene and cellulose films from Electra Private Equity, Epiris

Managers and Smithfield Group for $848 million

The acquisition will enable CCL Industries to enhance its leadership position in the

polymer banknote market

Pending

(12/19/2016)

Afton Chemical

Corporation

(NewMarket

Corporation)

Aditivos

Mexicanos, S.A. de

C.V.

(Chevron Oronite

Company LLC )

Afton Chemical agreed to acquire Aditivos Mexicanos, the Mexican-based

manufacturer of lubricants, gasoline and diesel additives, and components and

chemicals, from Chevron Oronite for approximately $183 million

The acquisition of Aditivos Mexicanos will enable Afton to expand their global

capabilities thereby bringing value added solutions to the customers

Pending

(12/15/2016)

Lonza Group Ltd Capsugel Inc.

(KKR & Co. L.P.)

Lonza agreed to acquire Capsugel, the Morristown, New Jersey-based developer of

dosage forms and solutions for the healthcare industry from KKR for $5.5 billion (5.1x

LTM 9/30/2016 sales and 15.1x LTM 9/30/2016 EBITDA)

The acquisition will support Lonza’s strategic ambition of getting closer to the end

consumer and creates a new dietary ingredient-ready offering

Capsugel generated LTM 9/30/2016 sales of $1.1 billion and adjusted EBITDA of

$364 million, respectively

Select recent transaction activity

4


Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

Pending

(12/14/2016)

Sika AG Rmax Operating,

LLC

(Hart Group, Inc.)

Sika agreed to acquire Rmax, the Dallas, Texas-based manufacturer and supplier of

polyiso insulation and specialty products for the OEM market

The acquisition will strengthen Sika’s building systems in roofing, sealants and

waterproofing in North America

Rmax generated 2016 sales over $75 million

Pending

(12/14/2016)

Schweitzer-

Mauduit

International, Inc.

Conwed Plastics,

LLC

(Leucadia National

Corp.)

SWM agreed to acquire Conwed Plastics, the Minneapolis, Minnesota-based

manufacturer of plastic netting and other specialty plastic products, from Leucadia for

$335 million (2.4x 2016E sales and 12.0x 2016E EBITDA)

The acquisition will provide significant cost synergies for SWM and expand its

product portfolio and manufacturing capabilities

Conwed Plastics is expected to generate 2016E sales and EBITDA of approximately

$140 million and $28 million, respectively

Pending

(12/14/2016)

The Jordan

Company, L.P.

OMG Borchers

GmbH

(Vectra

Corporation)

The Jordan Company agreed to acquire Borchers, the German-based manufacturer

of additives for colorants, coatings, paints and printing inks from Vectra Corporation

The acquisition will provide Borchers with a financial and operational partner to

realize its growth ambitions

Pending

(12/13/2016)

Nikko Chemicals

Co., Ltd.

(Nippon Steel &

Sumikin Bussan

Corporation)

Neossance

Business

(Amyris, Inc.)

Nikko Chemicals agreed to acquire a 50% stake in the Neossance business of

Amyris, a provider of renewable compounds for various markets in the United States

for $20 million

The acquisition will enable Nikko Chemicals to expand its geographic presence in the

United Sates

Pending

(12/13/2016)

Avery Dennison

Corporation

Hanita Coatings

RCA Ltd.

(Tene Capital and

Kibbutz Hanita)

Avery Dennison agreed to acquire Hanita Coatings, the Israel-based manufacturer of

engineered polyester films and laminates from Tene Capital and Kibbutz Hanita for

$75 million (1.5x 2015 sales)

The acquisition will expand Avery Dennison’s product portfolio and new growth

opportunities in architecture and automotive aftermarkets

Hanita Coatings generated 2015 sales of $50 million

Pending

(12/9/2016)

Evonik Industries

AG

Silica Business Unit

of Huber

Engineered

Materials

(J.M. Huber

Corporation)

Evonik agreed to acquire the Silica Business of Huber Engineered Materials, a

manufacturer of specialty engineered inorganic materials for the industrial and paper

industry for $630 million (2.1x 2016E sales and 10.5x 2016E EBITDA)

The acquisition will enable Evonik to expand its position in North America and Asia

and strengthen its growth segment resource efficiency

The Silica Business is expected to generate 2016E sales and EBITDA of

approximately $300 million and $60 million, respectively

12/9/2016

(12/9/2016)

Wind Point

Partners

Paragon Films, Inc. Wind Point acquired Paragon Films, the Broken Arrow, Oklahoma-based

manufacturer of high performance cast stretch films

The acquisition provides Paragon Films with the partners necessary to support the

Company through its next phase of growth and development


5


Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

12/8/2016

(12/8/2016)

Edgewater

Capital Partners

Fiber Materials, Inc.

(GrafTech

International

Holdings Inc.)

Edgewater acquired Fiber Materials, the Biddeford, Maine-based designer and

manufacturer of advanced composite materials from GrafTech

The acquisition enables FMI to seize on the accelerating growth in a number of

applications supported by Edgewater

Pending

(12/7/2016)

The Blackstone

Group

Acetow GmbH

(Solvay SA)

The Blackstone Group agreed to acquire Acetow, the German-based manufacturer of

cellulose acetate for cigarette filters and supplies cellulose acetate flakes from Solvay

for $1.1 billion (1.9x 2015 sales and 7.0x 2015 EBITDA)

The divestment of Acetow is in line with Solvay’s strategy to shift from base

chemicals and plastics business to multi-specialty chemical products

Acetow generated 2015 sales and EBITDA of approximately $565 million and $150

million, respectively

Pending

(12/7/2016)

Keter Plastic Ltd.

(BC Partners)

Arredo Plast spa

(Clessidra sgr)

Keter Plastic agreed to acquire Arredo Plast, the Italian-based manufacturer of plastic

injection moldings from Clessidra

The acquisition is part of Keter’s strategy to broaden its plastic products offering and

expand its geographic presence

1/4/2017

(12/7/2016)

PolyPeptide

Laboratories

Group

Lonza Braine SA

(Lonza Group Ltd)

Polypeptide Laboratories acquired Lonza Braine, the Belgium-based manufacturer of

therapeutic peptides from Lonza

The acquisition will enable PolyPeptide to enhance its manufacturing capacity and

capabilities to support its broad product portfolio

12/7/2016

(12/7/2016)

JLL Partners and

Water Street

Healthcare

Partners

MedPlast Inc.

(Baird Capital

Partners, River

Cities Capital

Funds and JZ

Capital Partners)

JLL Partners and Water Street Healthcare Partners acquired MedPlast, the Tempe,

Arizona-based provider of integrated custom plastic processing solutions from Baird

Capital Partners, River Cities Capital Funds and JZ Capital Partners

The acquisition provides MedPlast an avenue to grow its core competencies and

further build on its customer base

Pending

(12/6/2016)

Kansai Paint Co.,

Ltd.

Helios Group

Holding S.A.

(Ring International

Holding AG, GSO

Capital Partners LP

and Templeton

Asset Management

Ltd.)

Kansai Paint agreed to acquire Helios Group, the Luxembourg-based manufacturer

of paints and coatings from Ring International, GSO Capital Partners and Templeton

Asset Management for $608 million (1.4x 2015 sales)

The acquisition will enable to expand its manufacturing capabilities and geographic

footprint in the European coatings market

Helios Group generated 2015 sales of approximately $425 million

11/28/2016

(12/6/2016)

AST Plastic

Containers

GmbH

AMO-Plast GmbH AST Plastic Containers acquired AMO-Plast, the German-based manufacturer of

plastic jerrycans for the chemical and food and beverage industry

The acquisition strengthens AST’s position in the market and allows the company to

better serve its customers


6


Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

Pending

(12/5/2016)

Materion

Corporation

Target Materials

Business of

Heraeus Holding

GMBH

Materion agreed to acquire the Target Materials Business of Heraeus, the German-

based manufacturer of precious and non-precious metals for $30 million (0.5x 2015

sales and 6.0x 2015 EBITDA)

The acquisition enables Materion to expand its product offerings, while enhancing its

growth in new markets and strengthening its position in traditional markets

Heraeus‘ target materials business generated 2015 sales and EBITDA of $60 million

and $5 million, respectively

12/5/2016

(12/5/2016)

Hexcel

Corporation

Carbon

Conversions, Inc. Hexcel acquired Carbon Conversions, the Lake City, South Carolina-based

manufacturer of roll goods for composite reinforcement and recycled carbon fiber for

thermoplastic compounding

The acquisition will expand Hexcel’s production capacity and research capability for a

high performing aerospace and industrial applications

12/5/2016

(12/5/2016)

Edgewater

Capital Partners

DanChem

Technologies, Inc.

(Ensign-Bickford

Industries, Inc.)

Edgewater acquired DanChem, the Danville, Virginia-based provider of process

scale-up and contract manufacturing (tolling) services from Ensign-Bickford Industries

The acquisition provides DanChem a partner in the Company’s next phase of growth

through both organic and acquisition initiatives

12/1/2016

(12/1/2016)

Gurit Holding AG PET Structural

Foam Business of

BASF SE

Gurit acquired the PET Structural Foam Business of BASF, the Italian-based

manufacturer of structural foam products

The acquisition strengthens Gurit`s PET production capacity and adds the Kerdyn

product brand to Gurit's PET product offering

12/1/2016

(12/1/2016)

Hastings Equity

Partners, LLC

Impact! Chemical

Technologies, Inc. Hastings acquired Impact! Chemical Technologies, the Midland, Texas-based

manufacturer of chemistries for the oil and gas industry

The acquisition will provide Impact! with a financial and operational partner to realize

its growth ambitions

12/1/2016

(12/1/2016)

Döllken-Weimar

GmbH

(Surteco SE)

Nenplas Ltd.

(Maven Capital

Partners UK LLP)

Döllken-Weimar acquired a 85% stake in Nenplas, the U.K.-based manufacturer of

extruded and fabricated plastic products from Maven Capital Partners for $26 million

(1.5x 2015 sales and 6.4x 2015 EBITDA)

The acquisition expands Döllken-Weimar’s market position in technical profiles in the

European market

Nenplas generated 2015 sales and EBITDA of approximately $24 million and $5

million, respectively

12/1/2016

(12/1/2016)

Preferred

Compounding

Corporation

(Audax Group)

Trostel Ltd.

(Everett Smith

Group)

Preferred Compounding acquired Trostel, the Lake Geneva, Wisconsin-based

manufacturer of custom rubber seals and molded rubber products

The acquisition of Trostel will expand the growing mixing operation of Preferred and

add product molding to its capabilities

12/1/2016

(12/1/2016)

Neogen

Corporation

Quat-Chem Limited Neogen acquired Quat-Chem, the U.K.-based manufacturer of agricultural, industrial

and food processing biocidal hygiene products for $21 million

The acquisition aligns with the strategy of Neogen to expand its biosecurity business

and become a global product leader


7


Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

11/30/2016

(11/30/2016)

Quaker Chemical

Corporation

Lubricor Inc. Quaker acquired Lubricor, the Canadian-based manufacturer of metalworking

coolants, cutting and grinding oils, stamping and drawing lubricants for $12 million

(1.2x LTM 11/30/2016 Sales and 7.4x LTM 11/30/2016 EBITDA)

The acquisition enables Quaker to expand its metalworking business in attractive

markets by leveraging Lubricor's proprietary technology

Lubricor generated LTM 11/30/2016 sales and EBITDA of approximately $10 million


11/30/2016

(11/30/2016)

RelaDyne, Inc.

(Audax Group)

Lubricants and

Commercial Fuel

Divisions of Slidell

Oil Company

RelaDyne acquired the Lubricants and Commercial Fuel divisions of Slidell Oil

Company, the Alabama-based distributor of lubricants, fuel, diesel exhaust fluid and

industrial reliability services

The acquisition provides RelaDyne access to the Alabama market to expand

RelaDyne’s products and services

Pending

(11/29/2016)

Praxair, Inc. Linde AG Praxair agreed to acquire Linde AG, the German-based manufacturer of oxygen,

nitrogen, argon, hydrogen, acetylene, carbon monoxide and shielding gases for $45

billion (2.3x LTM 9/30/2016 sales and 10.3x LTM 9/30/2016 EBITDA)

The acquisition will expand Praxair’s technology capabilities and has significant

synergy opportunities

Linde generated LTM 9/30/2016 sales and EBITDA of approximately $20 billion and

$4 billion, respectively

11/28/2016

(11/28/2016)

Mexichem S.A.B.

de C.V.

Vinyl Compounds

Holdings Ltd. Mexichem acquired Vinyl Compounds, the U.K.-based manufacturer of PVC resin

and plasticisers

The acquisition will enhance Mexichem’s ability to meet global PVC compound

demand and further facilitate vertical integration

11/25/2016

(11/25/2016)

Wembly

Enterprises LLC

Bradford Industries,

Inc. Wembly Enterprises acquired Bradford Industries, the Lowell, Massachusetts-based

producer of coated fabrics and textiles

The acquisition provides Bradford Industries a partner in Wembly with industry

experience to support future growth

11/23/2016

(11/23/2016)

FAR Chemical,

Inc.

(Edgewater

Capital Partners)

Acetylacetonates

Product Line of

MacKenzie

Chemicals, LLC

FAR Chemical acquired the Acetylacetonates Product Line of MacKenzie Chemicals,

the New Orleans, Louisiana-based manufacturer of metal acetylacetonates utilized

as catalysts, cross linkers, curing agents and stabilizers

The acquisition marks an important step in executing Edgewater’s strategic focus in

organometallic chemistries and the addition of a proprietary product platform at FAR

11/23/2016

(11/23/2016)

Rogers

Corporation

DeWAL Industries,

Inc. Rogers acquired DeWAL Industries, the Saunderstown, Rhode Island-based

manufacturer of engineered materials and components

The acquisition strengthens Rogers’ Elastomeric Material Solutions business into

close market adjacency and increasing penetration into aerospace, electronics and

other attractive industrial industries

11/20/2016

(11/20/2016)

Stahl Holdings

BV

(Wendel Group)

Eagle Performance

Products Inc. Stahl acquired Eagle Performance Products, the Calhoun, Georgia-based

manufacturer of water-based flame retardant products

The acquisition adds technology and product diversification to Stahl’s extensive

product portfolio of process chemicals for leather products, performance coatings and

polymer dispersions


8


Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

11/18/2016

(11/18/2016)

Edgewater

Capital Partners

Inorganic

Specialties

Business of BASF

SE

Edgewater Capital Partners acquired the Inorganic Specialties business of BASF, the

Evans City, Pennsylvania-based producer of specialty alcoholates, boranes and

alkali metals

The acquisition provides the business with a partner with deep industry experience to

support future growth

11/11/2016

(11/11/2016)

PPG Industries,

Inc.

PPG Univer S.p.A.

(Univer Italiana

S.r.l.)

PPG acquired the remaining 50% stake in PPG Univer, the Italian-based

manufacturer of heat resistant silicone coating systems formulated for anti-corrosion

protection and aesthetic finish

The acquisition will enable PPG Industries to improve its position in Italy and

strengthen its presence in Europe

11/9/2016

(11/9/2016)

GCP Applied

Technologies Inc.

Halex Corporation GCP acquired Halex, the Canadian-based supplier of flooring products for $47 million

(1.0x 2015 sales)

The acquisition will enable GCP to offer wide range of products for interior

environments which will further expand its sales and distribution channels

Halex generated 2015 sales of $45 million

11/7/2016

(11/7/2016)

LGC Limited o2si smart

solutions, LLC LGC Limited acquired o2si Smart Solutions, the Charleston, South Carolina-based

manufacturer of organic and inorganic reference materials

The acquisition bolsters LGC’s market leading portfolio of reference materials for the

food and environment markets

Pending

(11/7/2016)

Bridgepoint

Advisers Limited

Agro Business of

the Sapec Group Bridgepoint agreed to acquire the Agro Business interests of the Sapec Group, the

Portuguese-based manufacturer of crop protection products and solutions for

approximately $503 million (2.0x LTM 11/7/2016 Sales)

The acquisition will enable the Sapec Group to accelerate growth in new markets and

further R&D developments

Halex generated LTM 11/7/2016 sales of $242 million

11/4/2016

(11/4/2016)

Meffert AG

Farbwerke and

Monti Lessini

S.R.L.

Colorificio A. & B.

Casati Spa Meffert AG Farbwerke and Monti Lessini acquired Colorificio A. & B. Casati Spa, the

Italian-based manufacturer of coatings

The acquition will enable Meffert AG Farbwerke and Monti Lessini S.R.L. to expand

its product portfolio and increase its presence in the construction industry

12/22/2016

(11/4/2016)

Norvestor Equity

AS

Presserv AS Norvestor acquired an 80% stake in Presserv, the Norwegian-based provider of

coatings and preservation and corrosion protection products

The acquisition provides Norvestor the opportunity to gain a foothold in the oil and

gas industry

Pending

(11/3/2016)

International

Flavors &

Fragrances Inc.

Fragrance

Resources, Inc. IFF agreed to acquire Fragrance Resources, the Clifton, New Jersey-based

manufacturer and supplier of flavors and fragrances for consumer products

The acquisition is in line with IFF’s Vision 2020 business strategy to become a key

leader in fragrance markets and accelerate growth


9


Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

11/3/2016

(11/3/2016)

Aramco Services

Company, Inc.

(Saudi Aramco)

Polyols Business of

Novomer, Inc. Aramco Services Company and Saudi Aramco Technologies acquired the Converge

Polyols businesses which comprises polyol polymer producing technology, from

Novomer, Inc. for $100 million

The acquisition strengthens Saudi Aramco’s integrated downstream expansion

strategy and enable it to enhance its operations in production of more sustainable

products in the petrochemicals conversion sector

11/2/2016

(11/2/2016)

Compagnie de

Saint-Gobain S.A.

h-old s.p.a.

(Arcadia SGR

S.P.A.)

Saint-Gobain acquired h-old, the Italian-based manufacturer and distributor of

specialty adhesive tapes for industrial and automotive markets from the Arcadia

Small Cap Fund

The acquisition enables h-old to expand its product portfolio and increase its

presence in the industrial and automotive markets

Pending

(11/2/2016)

Les Derives

Resiniques Et

Terpeniques

(DRT) SA

(Salvepar)

Pinova, Inc.

(Symrise AG)

DRT agreed to acquire Pinova, the Brunswick, Georgia-based distributor of specialty

rosins, polyterpene resins and sensory ingredients from Symrise for $150 million

The acquisition will expand DRT’s portfolio with industry applications and strengthen

its position in U.S. markets

11/2/2016

(11/2/2016)

RPM

International Inc.

Adhere Industrial

Tapes Limited RPM acquired Adhere Industrial Tapes, the U.K.-based manufacturer of single and

double sided foam tapes

The acquisition enables RPM to leverage Adhere’s wide range of products and

excellent customer service to generate significant new marketplace opportunities for

its tremco illbruck business

10/3/2016

(11/2/2016)

Clariant AG Specialty Reagents

Business of SNF

FloMin, Inc.

Clariant acquired the Specialty Reagents business of SNF FloMin, the Texas-based

manufacturer of reagents for the minerals processing industry

The acquisition strengthens Clariant’s production capacity to provide better customer

service and have a more secure supply chain

10/31/2016

(11/1/2016)

Ferro

Corporation

ESL

ElectroScience, Inc.

(Stein Family)

Ferro acquired Electro Science Laboratories, the King of Prussia-based manufacturer

of screen-printable thick-film materials and ceramic tapes for $75 million (1.9x 2016

Sales and 8.2x 2016 EBITDA)

The acquisition enables Ferro to strengthen its presence in the electronic packaging

materials market

ESL ElectroScience generated 2016 sales and EBITDA of approximately $40 million


Pending

(11/1/2016)

PPG Industries,

Inc.

Deutek S.A.

(Axxess Capital)

PPG agreed to acquire Deutek, the Romanian-based manufacturer of decorative

paints from Axxess Capital

The acquisition adds some of the fastest-growing paint brands in Romania to PPG’s

portfolio and enhances its presence in architectural coatings

Pending

(10/31/2016)

HollyFrontier

Corporation

Petro-Canada

Lubricants Inc.

(Suncor Energy

Inc.)

HollyFrontier agreed to acquire Petro-Canada Lubricants, the Canadian-based

developer, producer and distributor of lubricants, specialty fluids and greases from

Suncor Energy for $840 million (5.6x LTM 6/30/2016 EBITDA)

The acquisition will diversify HollyFrontier's offering with lubricant companies trading

at premium earnings and EBITDA multiples to refiners

HollyFrontier generated LTM 6/30/2016 EBITDA of approximately $150 million


10


Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

Pending

(10/31/2016)

INEOS

Styrolution

Group GmbH

KR Copolymer Co.

Ltd.

(Chevron Phillips

Chemical Co. LLC

and Daelim

Industrial Co., Ltd.)

INEOS agreed to acquire KR Copolymer, the South Korean-based manufacturer of

chemicals, chemical products and polymers from Chevron Phillips Chemical and

Daelim Industrial

The acquisition is in line with INEOS’s triple shift growth strategy with a strong focus

to its styrenic specialties business

10/31/2016

(10/31/2016)

DyStar LP Emerald Specialties

Business Group

(Emerald

Performance

Materials)

DyStar acquired the Emerald Specialties business of Emerald Performance Materials

The acquisition will add a broad product portfolio that services many multi-national

consumer goods brands to DyStar’s global product line

KeyBanc served as the exclusive sell-side advisor to Emerald Performance

Materials

11/07/2016

(10/25/2016)

Enerlabs, Inc. Energy &

Environmental

Services, Inc.

Enerlabs acquired Energy & Environmental Services, the Oklahoma City, Oklahoma-

based manufacturer and blender of custom specialty liquids and powder chemicals

for oil, gas and agricultural industries

The acquisition enables Enerlabs to expand its product and solution offering of liquid

and power chemicals

10/25/2016

(10/25/2016)

Mondoplastico

S.p.a.

Caltek srl Mondoplastico acquired Caltek, the Italian-based manufacturer of semi-rigid and

calendared PVC films

The acquisition enables Mondoplastico S.p.a. to strengthen its position in the PVC

films segment and expand its product offering

10/18/2016

(10/18/2016)

United Suppliers,

Inc.

Evans Enterprises,

LLC United Suppliers acquired Evans Enterprises, the Olathe, Kansas-based

manufacturer of ammonium chloride fertilizer products

The acquisition broadens United Suppliers capabilities to bring a strong and growing

ammonium chloride product line and business into its crop nutrients portfolio

12/1/2016

(10/17/2016)

Celanese

Corporation

SO.F.TER. SPA Celanese agreed to acquire SO.F.TER., the Italian-based manufacturer and

distributor of thermoplastic elastomers and engineering plastics

The acquisition enables Celanese to further extend its model, solutions capability and

project pipeline thereby enhancing its position in the engineered materials market

12/9/2016

(10/17/2016)

Ferro

Corporation

Cappelle Pigments

NV and certain

assets from Delta

Performance

Products LLC

Ferro acquired Cappelle Pigments, a producer and distributor of pigments, and the

pool and aggregate quartz color business of Delta Performance Products for a

combined $76 million (5.6x 2016E EBITDA)

The combined acquisitions are expected to increase the breadth of Ferro's pigments

offerings, increase its technical capabilities and build out its market position

Cappelle and Delta are expected to generate 2016E EBITDA of $11 million

Pending

(10/15/2016)

Continental AG Konrad Hornschuch

AG

(Equistone Partners

Europe)

Continental agreed to acquire Konrad Hornschuch, the German-based manufacturer

of design and functional films and artificial leather from Equistone Partners for

approximately $440 million

The acquisition will enable Continental to reaffirm its focus on acquiring companies

specialized in autonomous driving and electro-mobility

Pending

(10/13/2016)

Brenntag AG Lubricants

Business of NOCO

Energy Corp.

Brenntag agreed to acquire the Lubricants Business of NOCO Energy, which

comprises selling of lubricants for $28 million

The acquisition will enable Brenntag to leverage its existing infrastructure, add

additional talent and enhance its leading market position


11


Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

10/13/2016

(10/13/2016)

Niteo Products,

LLC

(Highlander

Partners)

Certain assets of

AP Formulators,

Inc.

Niteo Products acquired certain assets of AP Formulators, the Houston, Texas-based

formulator of a full line of car wash chemicals serving self-serve, automatic and

express / full service car washes

The acquisition strengthens Niteo Products’ car appearance products with AP

Formulators’ full service car wash offering

Pending

(10/11/2016)

M&C S.p.A. Treofan Holdings

GmbH M&C S.p.A. agreed to acquire Treofan Holdings, the German-based manufacturer of

biaxially oriented polypropylene films

The acquisition will allow Treofan additional strategic options for the company to

continue growing profitably worldwide

Pending

(10/10/2016)

Mecaplast Group Key Plastics L.L.C.

(Wayzata

Investment

Partners LLC)

Mecaplast agreed to acquire Key Plastics, the Livonia, Michigan-based manufacturer

of injection-molded automotive interior and trim components, exterior handles, and

under hood components from Wayzata Investment Partners

The acquisition will help Mecaplast to expand its presence in the United States,

Germany and China and diversify its customer portfolio

Pending

(10/6/2016)

Fluorsid S.p.A. Aluminum Fluoride

Operations of

Boliden Odda AS

Fluorsid agreed to acquire the Aluminum Fluoride Operations of Boliden Odda, the

Norwegian-based producer of refined zinc and aluminum fluoride powders

The acquisition will better position Fluorsid to further guarantee its customers with the

best available service

10/6/2016

(10/6/2016)

Southern Indiana

Plastics, Inc.

Progress Plastics

Inc. Southern Indiana Plastics Inc. acquired Progress Plastics, the Louisville, Kentucky-

based manufacturer of injection molding of thermoplastic parts

The acquisition enables Southern Indiana Plastics to add customers in the

electronics, window, conveyor industry and furniture markets

11/18/2016

(10/5/2016)

American

Securities

Chromaflo

Technologies Corp.

(Arsenal Capital

Partners and Nordic

Capital)

American Securities acquired Chromaflo Technologies, the Ashtabula, Ohio-based

manufacturer of chemical and pigment dispersions for architectural and industrial

coatings and thermoset composites markets, from Arsenal Capital Partners and

Nordic Capital

The acquisition provides Chromaflo a partner in its next phase of growth

KeyBanc served as the sell-side advisor to Chromaflo

10/5/2016

(10/5/2016)

Coba

International Ltd.

CD Plastic

Mouldings Limited

(The Concept

Group )

Coba International acquired CD Plastic Mouldings, the U.K.-based provider of plastic

injection molding services from The Concept Group

The acquisition will complement COBA International’s plastics business in terms of

the type of products

Pending

(10/4/2016)

Sigma Group,

Inc.

Alliance Barrier

Films LLC Sigma Group agreed to acquire Alliance Barrier Films, the Washington, Indiana-

based manufacturer of specialty coextruded films

The acquisition will enable Sigma Group to complement its ISOFlex Packaging

Division

10/4/2016

(10/4/2016)

Flint Group S.A. Printec Industries,

Inc.

(Ray Stanley and

Larry Bull)

Flint Group acquired Printec Industries, the Marietta, Georgia-based manufacturer of

water-based inks from Ray Stanley and Larry Bull

The acquisition supports Flint Group’s Paper & Board segment in North America,

strengthening its position and supporting its customers


12


Closed

(Announced)

Acquirer

(Parent)

Target

(Seller) Highlights

10/3/2016

(10/3/2016)

Chase

Corporation

Resin Designs, LLC Chase Corporation acquired Resin Designs, the Woburn, Massachusetts-based

manufacturer of custom adhesives and fabricated silicones

The acquisition broadens Chase’s adhesives and sealants product offering and

manufacturing capabilities and expands its market reach into logical adjacencies

10/3/2016

(10/3/2016)

American

Synthol, Inc.

Travis Oil LLC American Synthol acquired Travis Oil, the Skippack, Pennsylvania-based

manufacturer of synthetic oils for application as lubricants, anti-rust films and as

release agents in food processing machinery

The acquisition expands American Synthol's product line for the industrial

compressor market as well as adding advanced technology lubricant formulas for the

food grade and automotive markets

10/3/2016

(10/3/2016)

AMCHEM

Specialty

Chemicals UK

Limited (Manali

Petrochemicals)

Notedome Limited AMCHEM Specialty Chemicals acquired Notedome, a manufacturer of polyurethane

cast elastomers

The acquisition will facilitate AMCHEM’s progress in new technologies and

strengthen the efficiencies of existing systems and applications

10/3/2016

(10/1/2016)

Versarien plc AAC Cyroma

Limited Versarien acquired AAC Cyroma, the U.K.-based manufacturer of vacuum formed

and injection molded products

The acquisition enables Versarien to provide a dedicated facility from which to

manufacture graphene enhanced plastics on an industrial scale

12/9/2016

(9/14/2016)

Blue Wolf Capital

Management LLC

Extreme Plastics

Plus, Inc. Blue Wolf Capital acquired Extreme Plastics, the Fairmont, West Virginia-based

oilfield environmental services company

The acquisition provides Extreme Plastics the financial support and partner for its

next phase of growth


13

Source: Capital IQ, Reuters, SEC Filings

Specialty Chemicals Public Trading Statistics (Through December 31, 2016) $ in millions, except per share data

Stock Market Stock Performance (% Change) Enterprise LTM EBITDA EV / LTM Consensus EBITDA EV / EBITDA

Company Price Cap. 1 month 3 months 1 year Value Revenue EBITDA Margin EBITDA 2017P 2018P 2017P 2018P

Axalta Coating Systems, Ltd. AXTA $27.20 $6,541 3.0% (3.8%) 2.1% $9,618 $4,048 $880 21.8% 10.9x $955 $993 10.1x 9.7x

Chase Corporation CCF $83.55 $781 3.7% 20.9% 105.1% $751 $238 $66 27.7% 11.4x NM NM NA NA

GCP Applied Technologies Inc. GCP $26.75 $1,900 (4.5%) (5.5%) NA $3,312 $1,355 $236 17.4% 14.0x $280 $299 11.8x 11.1x

H.B. Fuller Company FUL $48.31 $2,430 2.8% 4.0% 32.5% $3,013 $2,068 $267 12.9% 11.3x $309 $333 9.8x 9.0x

PPG Industries, Inc. PPG $94.76 $25,016 (1.2%) (8.3%) (4.1%) $28,531 $15,370 $2,701 17.6% 10.6x $2,746 $2,817 10.4x 10.1x

Quaker Chemical Corporation KWR $127.94 $1,696 0.6% 20.8% 65.6% $1,683 $739 $104 14.1% 16.2x $112 $120 15.0x 14.0x

RPM International Inc. RPM $53.83 $7,180 1.7% 0.2% 22.2% $8,902 $4,823 $659 13.7% 13.5x $728 $774 12.2x 11.5x

Sherwin-Williams Company SHW $268.74 $24,968 0.0% (2.9%) 3.5% $26,384 $11,678 $1,966 16.8% 13.4x $2,162 $2,318 12.2x 11.4x

Valspar Corporation VAL $103.61 $8,229 1.5% (2.3%) 24.9% $9,833 $4,234 $674 15.9% 14.6x $735 $770 13.4x 12.8x

Average 0.8% 2.6% 31.5% $10,225 $4,950 $839 17.0% 12.9x 11.9x 11.2x

Median 1.5% (2.3%) 23.5% $8,902 $4,048 $659 16.3% 13.4x 12.0x 11.2x

A. Schulman, Inc. SHLM $33.45 $981 0.5% 14.9% 9.2% $2,031 $2,496 $221 8.8% 9.2x $231 $249 8.8x 8.2x

Calumet Specialty Products Partners CLMT $4.00 $306 0.0% (11.3%) (79.9%) $2,307 $3,551 $93 2.6% NM $259 $282 8.9x 8.2x

Ferro Corporation FOE $14.33 $1,195 (3.2%) 3.8% 28.9% $1,649 $1,129 $180 16.0% 9.2x $219 $239 7.5x 6.9x

Hexcel Corporation HXL $51.44 $4,720 (0.5%) 16.1% 10.7% $5,349 $1,986 $444 22.3% 12.1x $496 $548 10.8x 9.8x

Innospec Inc. IOSP $68.50 $1,643 4.3% 12.6% 26.1% $1,624 $892 $131 14.7% 12.4x $163 $171 10.0x 9.5x

Kraton Performance Polymers, Inc. KRA $28.48 $880 (7.6%) (18.7%) 71.5% $2,637 $1,838 $358 19.5% 7.4x $385 $414 6.8x 6.4x

NewMarket Corporation NEU $423.84 $5,022 1.3% (1.3%) 11.3% $5,365 $2,027 $409 20.2% 13.1x $396 NM 13.5x NA

OMNOVA Solutions Inc. OMN $10.00 $451 4.2% 18.5% 63.1% $894 $773 $82 10.6% 10.9x NM NM NA NA

PolyOne Corporation POL $32.04 $2,684 (2.8%) (5.2%) 0.9% $3,733 $3,328 $384 11.5% 9.7x $451 $481 8.3x 7.8x

Stepan Company SCL $81.48 $1,826 0.4% 12.1% 64.0% $1,946 $1,765 $210 11.9% 9.3x $239 NM 8.1x NA

Tredegar Corp. TG $24.00 $784 7.6% 29.1% 76.2% $847 $841 $79 9.3% 10.8x $84 $84 10.1x 10.0x

Average 0.4% 6.4% 25.6% $2,580 $1,875 $235 12.6% 10.4x 9.3x 8.3x

Median 0.4% 12.1% 26.1% $2,031 $1,838 $210 11.4% 10.3x 8.8x 8.2x

Albemarle Corporation ALB $86.08 $9,682 (1.9%) 0.7% 53.7% $13,761 $3,914 $973 24.9% 14.1x $806 $880 NM NM

Ashland Inc. ASH $109.29 $3,141 (3.0%) (5.7%) 6.4% $4,262 $3,019 $592 19.6% 7.2x $587 $620 7.3x 6.9x

Cabot Corporation CBT $50.54 $3,150 (0.8%) (3.6%) 23.6% $4,000 $2,411 $458 19.0% 8.7x $508 $592 7.9x 6.8x

Celanese Corporation CE $78.74 $11,276 (0.7%) 18.3% 16.9% $13,468 $5,412 $1,523 28.1% 8.8x $1,640 $1,682 8.2x 8.0x

Chemtura Corporation CHMT $33.20 $2,092 0.8% 1.2% 21.7% $2,370 $1,668 $306 18.3% 7.7x $312 $332 7.6x 7.1x

Eastman Chemical Co. EMN $75.21 $11,037 0.1% 11.1% 11.4% $17,589 $9,045 $2,114 23.4% 8.3x $2,211 $2,283 8.0x 7.7x

FMC Corp. FMC $56.56 $7,570 0.8% 17.0% 44.5% $9,452 $3,316 $672 20.3% 14.1x $786 $849 12.0x 11.1x

Huntsman Corporation HUN $19.08 $4,544 (2.1%) 17.3% 67.8% $8,845 $9,594 $1,025 10.7% 8.6x $1,262 $1,380 7.0x 6.4x

Ingevity Corp. NGVT $54.86 $2,310 4.8% 19.0% NA $2,809 $915 $192 20.9% 14.7x $220 $250 12.7x 11.2x

KMG Chemicals Inc. KMG $38.89 $461 15.1% 37.3% 68.9% $477 $298 $46 15.6% 10.3x $51 $53 9.4x 9.0x

Koppers Holdings Inc. KOP $40.30 $833 5.1% 25.2% 120.8% $1,501 $1,467 $150 10.3% 10.0x $179 $195 8.4x 7.7x

LSB Industries Inc. LXU $8.42 $235 9.4% (1.9%) 16.1% $820 $653 $4 0.6% NM NM $141 NM 5.8x

Minerals Technologies Inc. MTX $77.25 $2,699 (4.6%) 9.3% 68.4% $3,650 $1,667 $343 20.6% 10.6x $368 $374 9.9x 9.8x

Olin Corp. OLN $25.61 $4,233 (1.5%) 24.8% 48.4% $7,786 $5,432 $818 15.1% 9.5x $1,015 $1,089 7.7x 7.1x

Orion Engineered Carbons SA OEC $18.85 $1,119 (1.3%) 0.6% 49.6% $1,728 $1,014 $235 23.2% 7.3x $246 $260 7.0x 6.6x

Platform Specialty Products Corporation PAH $9.81 $2,732 4.9% 21.0% (23.5%) $8,031 $3,371 $713 21.2% 11.3x $824 $876 9.8x 9.2x

Westlake Chemical Corporation WLK $55.99 $7,221 (5.4%) 4.7% 3.1% $11,536 $7,419 $1,363 18.4% 8.5x $1,520 $1,525 7.6x 7.6x

W.R. Grace & Co. GRA $67.64 $4,741 3.6% (8.3%) (32.1%) $6,137 $1,597 $495 31.0% 12.4x $542 $579 11.3x 10.6x

Average 1.3% 10.4% 33.3% $6,568 $3,456 $668 19.3% 10.1x 9.3x 8.6x

Median (0.3%) 10.2% 23.6% $5,199 $2,715 $544 20.0% 9.5x 8.2x 7.7x

Albany Molecular Research Inc. AMRI $18.76 $780 11.3% 13.6% (5.5%) $1,377 $691 $117 17.0% 11.7x $136 $143 10.1x 9.6x

American Vanguard Corp. AVD $19.15 $562 5.2% 19.2% 36.7% $600 $308 $41 13.3% 14.7x $49 $49 12.3x 12.2x

Balchem Corp. BCPC $83.92 $2,662 5.1% 8.2% 38.0% $2,928 $545 $135 24.7% 21.7x $161 $168 18.2x 17.4x

Cambrex Corporation CBM $53.95 $1,735 7.7% 21.3% 14.6% $1,644 $467 $143 30.6% 11.5x $166 $169 9.9x 9.7x

Innophos Holdings Inc. IPHS $52.26 $1,011 (4.1%) 33.9% 80.3% $1,178 $728 $116 15.9% 10.2x $128 $138 9.2x 8.5x

International Flavors & Fragrances Inc. IFF $117.83 $9,359 (2.7%) (17.6%) (1.5%) $10,230 $3,069 $702 22.9% 14.6x $765 $824 13.4x 12.4x

Sensient Technologies Corp. SXT $78.58 $3,500 0.6% 3.7% 25.1% $4,095 $1,392 $255 18.3% 16.0x $280 $301 14.6x 13.6x

Average 3.3% 11.8% 26.8% $3,150 $1,029 $216 21.0% 14.3x 12.5x 11.9x

Median 5.1% 13.6% 25.1% $1,644 $691 $135 19.5% 14.6x 12.3x 12.2x

Overall Average 1.3% 8.1% 29.9% 11.5x 10.3x 9.6x

Overall Median 0.6% 8.2% 24.9% 10.9x 9.9x 9.5x

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Source: Capital IQ, Standard & Poor’s, SEC Filings

Specialty Chemicals Public Trading Statistics (Through December 31, 2016) $ in millions

Total Net Total Debt / Net Debt / Total Debt / LTM EBITDA / LT S&P

Company Ticker Debt Debt LTM EBITDA LTM EBITDA LTM EBITDA Capital Interest Rating

Axalta Coating Systems, Ltd. AXTA $3,485 $2,957 $880 4.0x 3.4x 72.4% 4.7x -

Chase Corporation CCF $41 ($8) $66 0.6x NM 19.0% NM -

GCP Applied Technologies Inc. GCP $807 $658 $236 3.4x 2.8x 117.2% 4.7x BB-

H.B. Fuller Company FUL $712 $578 $267 2.7x 2.2x 42.5% 10.3x BBB

PPG Industries, Inc. PPG $4,404 $3,425 $2,701 1.6x 1.3x 46.2% 21.1x A-

Quaker Chemical Corporation KWR $76 ($23) $104 0.7x NM 15.6% NM -

RPM International Inc. RPM $1,977 $1,693 $659 3.0x 2.6x 60.6% 7.1x BBB

Sherwin-Williams Company SHW $2,119 $1,416 $1,966 1.1x 0.7x 57.0% 15.1x A

Valspar Corporation VAL $1,778 $1,604 $674 2.6x 2.4x 61.5% 7.4x BBB

Average 2.2x 2.2x 54.7% 10.1x

Median 2.6x 2.4x 57.0% 7.4x

A. Schulman, Inc. SHLM $942 $903 $221 4.3x 4.1x 86.2% 4.1x BB-

Calumet Specialty Products Partners CLMT $2,002 $1,985 $93 NM NM 87.2% 0.7x B-

Ferro Corporation FOE $487 $447 $180 2.7x 2.5x 60.7% 8.7x BB-

Hexcel Corporation HXL $675 $629 $444 1.5x 1.4x 34.9% 20.2x BBB-

Innospec Inc. IOSP $148 ($20) $131 1.1x NM 18.4% NM -

Kraton Performance Polymers, Inc. KRA $1,722 $1,579 $358 4.8x 4.4x 76.3% 3.3x B

NewMarket Corporation NEU $531 $343 $409 1.3x 0.8x 52.7% 20.5x BBB+

OMNOVA Solutions Inc. OMN $367 $291 $82 4.5x 3.6x 79.7% 3.0x B

PolyOne Corporation POL $1,260 $1,047 $384 3.3x 2.7x 62.5% 6.3x BB

Stepan Company SCL $326 $119 $210 1.6x 0.6x 33.8% 15.2x -

Tredegar Corp. TG $92 $63 $79 1.2x 0.8x 22.4% 21.0x -

Average 2.6x 2.3x 55.9% 10.3x

Median 2.1x 2.5x 60.7% 7.5x

Albemarle Corporation ALB $3,449 $3,216 $973 3.5x 3.3x 50.0% 8.7x BBB-

Ashland Inc. ASH $2,501 $1,121 $592 4.2x 1.9x 50.6% 3.1x BB

Cabot Corporation CBT $952 $752 $458 2.1x 1.6x 41.0% 8.5x BBB

Celanese Corporation CE $3,015 $1,751 $1,523 2.0x 1.1x 48.9% 12.3x BBB-

Chemtura Corporation CHMT $479 $277 $306 1.6x 0.9x 32.7% 9.9x BB-

Eastman Chemical Co. EMN $6,684 $6,477 $2,114 3.2x 3.1x 59.7% 7.5x BBB

FMC Corp. FMC $1,977 $1,846 $672 2.9x 2.7x 48.2% 8.0x BBB

Huntsman Corporation HUN $4,557 $4,118 $1,025 4.4x 4.0x 72.0% 5.2x BB-

Ingevity Corp. NGVT $519 $491 $192 2.7x 2.6x 79.7% 8.9x -

KMG Chemicals Inc. KMG $33 $16 $46 0.7x 0.3x 18.4% NM -

Koppers Holdings Inc. KOP $682 $664 $150 4.5x 4.4x NM 3.0x B

LSB Industries Inc. LXU $521 $444 $4 NM NM 44.2% 0.2x CCC

Minerals Technologies Inc. MTX $1,129 $924 $343 3.3x 2.7x 52.0% 5.9x BB

Olin Corp. OLN $3,680 $3,553 $818 4.5x 4.3x 61.2% 4.1x BB

Orion Engineered Carbons SA OEC $686 $609 $235 2.9x 2.6x NM 5.5x BB-

Platform Specialty Products Corporation PAH $5,337 $4,623 $713 7.5x 6.5x 60.0% 1.9x BB-

Westlake Chemical Corporation WLK $4,333 $3,952 $1,363 3.2x 2.9x 39.8% NM BBB

W.R. Grace & Co. GRA $1,597 $1,392 $495 3.2x 2.8x NM 5.6x BB+

Average 3.3x 2.8x 50.6% 6.1x

Median 3.2x 2.7x 50.0% 5.7x

Albany Molecular Research Inc. AMRI $691 $646 $117 5.9x 5.5x 65.5% 3.5x B

American Vanguard Corp. AVD $44 $38 $41 1.1x 0.9x 13.8% 21.3x -

Balchem Corp. BCPC $298 $266 $135 2.2x 2.0x 36.6% 19.2x -

Cambrex Corporation CBM $0 ($91) $143 NM NM 0.0% NM -

Innophos Holdings Inc. IPHS $199 $166 $116 1.7x 1.4x 36.6% 13.2x -

International Flavors & Fragrances Inc. IFF $1,368 $867 $702 1.9x 1.2x 44.6% 13.4x BBB+

Sensient Technologies Corp. SXT $618 $595 $255 2.4x 2.3x 41.3% 13.7x -

Average 2.5x 2.2x 34.1% 14.0x

Median 2.1x 1.7x 36.6% 13.6x

Overall Average 2.8x 2.5x 50.1% 9.1x

Overall Median 2.7x 2.6x 49.4% 7.5x

Ad

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Fin

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15

5-Year Index Performance

KBCM’s Specialty Chemicals Index rose 1.9% for the quarter ended December 31st, versus a 3.6% increase in the S&P 500

5-Year Enterprise Value / LTM EBITDA Valuations

KBCM Specialty Chemicals Index valuations increased to 10.9x EV / LTM EBITDA as of December 31st

Source: Capital IQ, SEC Filings

Note: KBCM Specialty Chemicals Index includes: ALB, AMRI, ASH, AVD, AXTA, BCPC, CBM, CBT, CCF, CE, CHMT, CLMT, EMN, FMC, FOE, FUL, GCP,

GRA, HUN, HXL, IFF, IOSP, IPHS, KMG, KOP, KRA, KWR, LXU, MTX, NEU, NGVT, OEC, OLN, OMN, PAH, POL, PPG, RPM, SCL, SHLM, SHW, SXT,

TG, VAL, VSM , WLK

107.4%

75.3%

0%

50%

100%

150%

200%

250%

Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16

0.0x

2.0x

4.0x

6.0x

8.0x

10.0x

12.0x

14.0x

Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16

Average: 9.8x

Specialty Chemicals Valuations (Through December 31, 2016)

KBCM Specialty

Chemicals IndexS&P 500

Last 12 Months 15.6% 11.2%

Last 3 Months 1.9% 3.6%

Last 1 Month (0.5%) 1.6%

16

For additional information on KeyBanc Capital Markets’ Specialty Chemicals Practice, please contact any of the individuals listed below

Key Tower, Floor 6 127 Public Square Cleveland, OH 44114

Mario Toukan

Managing Director

Head of Chemicals Practice

216.689.4663

[email protected]

Ben Whiting

Director

Chemicals Practice

216.689.4120

[email protected]

Alain Harfouche

Vice President

Chemicals Practice

216.689.3995

[email protected]

Dan Lory

Associate

Chemicals Practice

216.689.3096

[email protected]

SPECIALTY CHEMICALS TEAM CONTACTS

November 2015

Buy-Side Advisor

has acquired

December 2015

Sell-Side Advisor

has been acquired by

a portfolio company of

Select KeyBanc Capital Markets Transaction Experience

February 2016


has acquired

Buy-Side Advisor

February 2016



Sell-Side Advisor

Polymer Solutions Group


February 2016



Sell-Side Advisor

September 2016


$690,000,000

Senior Secured Credit Facilities

Joint Lead Arranger &

Joint Bookrunner

August 2016


Sell-Side Advisor


July 2016

has spun-off from

$375,000,000

Senior Notes

Co-Manager

May 2016

has merged with

$1,400,000,000


Joint Lead Arranger &

Joint Bookrunner


$625,000,000

Senior Secured Notes

January 2016

has spun-off from

$525,000,000

Senior Unsecured Notes

Co-Manager

$525,000,000

Senior Secured Credit Facility

May 2016

has spun-off from

Co-Agent

$700,000,000


December 2015


Sole Lead Arranger,

Sole Bookrunner &

Administrative Agent

$235,500,000


December 2015


Sole Lead Arranger,

Sole Bookrunner &

Administrative Agent

$95,500,000


October 2016



Sell-Side Advisor

Specialties Group

November 2016



Sell-Side Advisor

Documents

Specialty Chemicals Review - Oracle · 2017-01-26 · analysis of any security, issuer, or industry and is not an offer or a solicitation of an offer to buy or sell any securities