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Chemicals M&A – Investment Banking Review of 2022 & Outlook for 2023

5 Jan 2023

In this review of key trends for the Chemical industry, Natrium Capital looks forward into 2023. The past year has tested the resilience of the Chemical industry as the global economy has been fraught with political and macroeconomic instability.

2023 is likely to be a challenging year. The worst of the energy price rises has been seen but core inflationary pressures will continue. We expect further interest rate rises, albeit the pace of these changes has peaked, and economic activity remains weak. This all comes with the ongoing environmental pressure for a circular economy. In this uncertain environment, business leaders are focussed on seeking new opportunities for growth and on investing to provide greater supply chain and feedstock flexibility.

Obtaining debt finance for dealmaking is more difficult and higher interest rates will continue to put pressure on firms with high leverage. Despite these barriers, we expect steady Mergers and Acquisitions (M&A) activity as businesses restructure and divest non-core activities and capital is invested by Private Equity.

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