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Chemicals M&A – Investment Banking Review of 2021 & Outlook for 2022

20 Jan 2022

In this review of the Chemical industry, Natrium Capital looks forward into 2022 as well as reviewing the trends from 2021. Forecasters are expecting increased output as industrial activity and trade rebound around the world as economies reopen. The realities of a post-pandemic world will, however, dominate 2022 producing volatile conditions amongst long-term recovering trends.

The outlook for 2022 is positive with the Chemical industry set to benefit from an improving economic backdrop leading to a benign environment for Mergers and Acquisitions (M&A).

Demand for quality assets remains high and will encourage a review of opportunities to restructure portfolios. Shifting focus towards sustainable, environmentally friendly technologies and growth markets will continue to be attractive. Private Equity firms have plentiful funds and are active in searching for new prospects. With interest rates remaining relatively low and plentiful supply of capital, transaction multiples are at high levels with average disclosed deal multiples in the Chemicals and Materials sectors at a historically high level of 14x. In 2022, we expect to see continuing high levels of take-over activity, corporate sales and carve-outs leading to many investment opportunities for companies looking to expand by acquisition.

Read more: Click to open full PDF with charts and data

“… over $100bn of transactions over the last twenty years”