M&A Activities:  1H - 2010 <br />Ennovance Capital LLC<br />Specialty PE Firm<br />Operational Focused, Niche Chemical and...
Statistics: 1H - 2010<br />M&A Deal Activity for Global Chemicals Sector Up 45% in First Half of 2010 Over First Half of 2...
Total Value2$ 83.5 b
Average Deal Value (515 deals)		               $162mm
Pharmaceuticals 					    	  713
Total Value3           $ 78.2 b
Average Deal Value (515 deals)	   		   $150mm</li></ul>www.ennovance.com<br />Note: 1 Pwc source; 2, 3 Includes all types ...
Chemicals 1H -2010<br /><ul><li> The Deal activity in first half of 2010 went up both in the number of deals and in transa...
Total deals in 2010 	788
Total deals in 2009 	542
Total deals in 2008 	806
Total deals in 2007	336
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Ennovance Chemical M&A

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1H-2010 M&amp;A

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Ennovance Chemical M&A

  1. 1. M&A Activities: 1H - 2010 <br />Ennovance Capital LLC<br />Specialty PE Firm<br />Operational Focused, Niche Chemical and Related Industries PE Investor<br />www.ennovance.com<br />BLOG: http://ennovance.blogspot.com/<br />
  2. 2. Statistics: 1H - 2010<br />M&A Deal Activity for Global Chemicals Sector Up 45% in First Half of 2010 Over First Half of 20091<br />Total Deals: <br /><ul><li>Chemicals 788
  3. 3. Total Value2$ 83.5 b
  4. 4. Average Deal Value (515 deals) $162mm
  5. 5. Pharmaceuticals 713
  6. 6. Total Value3 $ 78.2 b
  7. 7. Average Deal Value (515 deals) $150mm</li></ul>www.ennovance.com<br />Note: 1 Pwc source; 2, 3 Includes all types of deals<br />
  8. 8. Chemicals 1H -2010<br /><ul><li> The Deal activity in first half of 2010 went up both in the number of deals and in transaction value compared with the same period in 08’ and 09’
  9. 9. Total deals in 2010 788
  10. 10. Total deals in 2009 542
  11. 11. Total deals in 2008 806
  12. 12. Total deals in 2007 336
  13. 13. Total deals in 2006 317
  14. 14. The value of transaction has almost doubled since 2009 and increased by 2.5 time since 2008
  15. 15. The real activity is even higher than data suggests due to the longer process of deal making in the post recession period.</li></ul>www.ennovance.com<br />
  16. 16. Deal activity by the number of deals2006-2010, H1<br />www.ennovance.com<br /><ul><li>The number of deals went up by 117 deals
  17. 17. The focus has shifted toward small (under 100 million) and middle size deals (100-500 million)
  18. 18. Reason: Due to the economic downturn, the companies are more focused on their core businesses and tend to acquire divestitures rather than whole companies to strengthen their performance
  19. 19. The acquisition of the divestitures have a higher proof of success for buyers and sellers</li></li></ul><li>Transaction types in Chemicals<br /><ul><li>Sharp decrease in bankruptcies, BuyBacks
  20. 20. The number of IPOs has doubled since 2009 and tripled since 2008
  21. 21. A steady increase in Shelf registration across the years
  22. 22. As the financial situation improves, we observe many solvent companies willing to exit through IPOs.
  23. 23. The increase in IPOs demonstrated the strengthening demand for chemicals from the institutional investors – good news for PE firms.
  24. 24. However, due to the existing uncertainty in the current market, many are still waiting for more profitable conditions and complete Shelf registration with the expectation to exit in the next 3 years.</li></ul>www.ennovance.com<br />
  25. 25. Transaction types in Pharmaceuticals<br /><ul><li>With the improvement of the economy, only 7 bankruptcies were announced in 2010
  26. 26. The number of IPOs, Shelf registrations, and M&A activities stays in line with the numbers from 2008/2009
  27. 27. The increase in M&A transaction is expected to become stronger in 2H due to the overall improvement of the economy and easier access to credit
  28. 28. A 2009 tend of going private and abandoning the public shares is expected do be slowing down in H2 of 2010 as the financial performance of many improves</li></ul>www.ennovance.com<br />
  29. 29. Most Active Sellers (Ultimate Parent) Pharmaceuticals, 1H - 2010<br /># of deals<br />Total Value Sold<br />13,867.68$<br />4,978.14$<br />2989.1$<br />www.ennovance.com<br />
  30. 30. Most Active Sellers (ultimate parent) Chemicals, 1H 2010<br /># of deals<br />www.ennovance.com<br />
  31. 31. Chemical Industry trends and outlook<br />Chemical companies are operating below their capacity<br />Higher M&A activity, increased competition and more deals made by specialty PE firms <br />New or Green Technologies<br />New Opportunity due Regulation and Climate Change<br /> …….<br /> …….<br />www.ennovance.com<br />
  32. 32. Pharmaceuticals: Trends and outlook<br />Strong activity in cross border deals<br />Weak M&A activity in the US and EU in comparison with previous years<br /> A flood of companies “exits” is expected from the PE firms as a result of the PE investments earlier in the decade. <br />…..<br />…..<br />www.ennovance.com<br />
  33. 33. Market for M&A Today:<br />Deal Catalysts:<br />Economic downturn: the existing market conditions offer a wide spectrum of opportunities for M&A in Chemicals<br />Acquire companies thorough potential partnership approach<br />Sellers generate more 13% more profit <br />The acquisition of the divestiture in 57.7% generate positive returns as opposed to 41.7% when buying the whole company<br />Long value chain and complex industry; …creates opportunity for industry experts, deep knowledge with extensive network<br />Environmental risks is a fear for generalist investor <br />Falling stock market works both ways<br />Focus on value instead of a deal price or multiples <br />……..<br />www.ennovance.com<br />
  34. 34. Remarks<br />Due to confidential and proprietary nature, Ennovance Capital published only a few slides. <br />Sources used:<br />Primary market research<br />Secondary data sources includes, but not limited to Capital IQ, Thomson One Banker, VC Experts, and various industry related reports etc.<br />www.ennovance.com<br />WWW.ENNOVANCE.COM<br />BLOG: http://ennovance.blogspot.com/<br />Phone: +1 (800) 901-1006<br />

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