Adhesives and Sealants Market
November 2016 www.coatingsworld.com Coatings World | 43
associated with compliance and raw materials (when reformulations are required) are real and can be substantial – particularly
for smaller companies. Although resistance to change, by both
end users and manufacturers, and the cost of compliance may
hinder the rate of adoption somewhat, more stringent environmental regulations are a way of life for industry participants
and will need to be continually addressed.
However, increasing environmental regulations are not
always viewed as a hurdle by the industry.
For example, more stringent fuel economy regulations are
driving the trend of vehicle lightweighting, which directly benefits adhesive and sealant manufacturers. The regulatory environment also is forcing investment in R&D and new technology
development, which should benefit the industry over the long
term. More and more companies are committing to sustainability efforts and social responsibility practices, and are taking
a proactive approach when it comes to regulations.
CW: Have there been any major company news, such as ac-
quisitions, joint ventures, in the adhesives and sealants in-
dustry lately?
Hinz: The industry has undergone a continuous period of con-
solidation in recent years, with more than 100 adhesive and seal-
ant formulator acquisitions (globally) reported since the start of
2014. Corporate balance sheets remain strong, private equity
groups are flush with cash, and relatively inexpensive credit is
available – all which have combined to create an extremely ro-
bust M&A environment. Beyond the major formulators, rel-
atively few adhesive and sealant companies have revenues in
excess of $100 million, leading most strategic buyers to pursue
smaller “bolt-on” acquisitions that provide access to new prod-
ucts, technologies, or geographies, with the added potential for
meaningful cost synergies.
Examples of recent transactions include Bostik’s purchase of Den Braven, which will significantly enhance
Bostik’s position in the sealants market, and H.B. Fuller’s
acquisition of Cyberbond, which is well-aligned with H.B.
Fuller’s strategy to grow in the engineering adhesives market. Royal Adhesives has continued its serial acquisition
strategy by completing three deals in the first half of 2016.
We expect deal activity to remain strong for the foreseeable
future, with major adhesive and sealant formulators taking
an active approach to M&A.CW
Grace Matthews provides strategic transaction advice spanning
the entire chemical value chain: beginning with extractive industries such as petrochemicals and minerals, through intermediates, plastics, ceramics, specialties, formulated coatings, inks
and adhesives, packaging, converted paper and films, and green
chemistries, biopolymers and advanced materials.
