A global private equity firm was considering an acquisition of a specialty chemicals manufacturer and supplier with substantial participation in food and agriculture, transportation, coatings, health, and personal care markets.
While having knowledge and operating partners in the specialty chemicals industry, the client engaged Ducker to obtain a granular view to not only the opportunity, but also its potential risks. The potential acquisition represented an opportunity to diversify the client’s portfolio, invest in a global leader in specialty chemical solutions and form platform investment for future acquisitions to further bolster its specialty market leader positioning.
The client’s acquisition target participates in a fragmented market from both a customer and raw material supplier standpoint but presents a considerable expansion opportunity for the client through increased market demand, potential share gain and complementary bolt-on acquisitions.
Ducker provided a tailored solution for the client, involving multiple phases of market outreach to ultimately deliver a comprehensive market model and demand analysis highlighting current cycle positioning and forecast scenarios, an in-depth overview and analysis of the competitive landscape, including core and adjacent competitors and potential new entrants, as well as a detailed voice of customer study and thorough risk assessment.
Methodology implemented to achieve output during all project phases utilized proprietary data and historic Ducker benchmarks to validate a market and demand analysis, in addition to leveraging our vast network of industry experts to support outreach to specific engineering and purchasing agents within large multinational customers that could comment directly on their relationship with the acquisition Target and its competitors.
Additionally, Ducker leveraged an internal team that was able to effectively manage and pursue multiple parallel research paths while maintaining high levels of collaboration with our client, ultimately leading to a cohesive and extensive final report. To quickly ramp-up on our global industry analysis, Ducker’s initial engagement team included global support across Europe, India, Asia and the North America office.
Ducker presented a quantified view to any potential investment liabilities or risks, as well as a view of market size, segmentation, forecast and demand drivers, and competitive landscape and positioning.
Deliverables included total and addressable market size and growth forecast for the core segments under study, customer feedback and analysis focused on market trends and future sourcing plans in relation to the Target, supply preferences and barriers to switching, a detailed analysis and mapping of acquisition target and direct competitor offerings and positioning and a risk analysis overview comprised of an environmental, health and safety audit of current product portfolio chemistries.
Ducker’s diligence output helped the client’s investment committee understand the significant value of the investment opportunity, as well as the potential risks associated with specialty chemical manufacturing and distribution, which lead to a successful acquisition close.