KBS - Chemical Manufacturing and Development - Market Insight

SPECIALITIES Strategic acquirers are pursuing speciality chemical businesses, particularly those with high margins and niche market leadership. These include firms in sub-sectors such as flavours and fragrances, food additives, personal care ingredients, nutraceuticals, and speciality coatings. There has been a wave of investments into these sub categories. For example, Firmenich International SA (fragrance) merged with DSM (nutrition) to establish DSM Firmenich AG, a leader in perfumes and food ingredients. TECHNOLOGY Chemical firms are acquiring service-oriented businesses or digital platforms. This includes speciality chemical distributors for better market reach and data analytics/software firms that enhance operations. For example, global distributors such as Brenntag and Azelis have been acquiring smaller speciality distributors to broaden their product range and customer base. Moreover, firms have shown interest in acquiring specialists that utilise AI for chemical formulation or platforms that connect producers with customers more efficiently, for example UK company Croda has acquired biotech and tech-driven firms, from marine biotechnology to encapsulation tech, to develop its pipeline.

Total deal value for H2 2024 reached $13.9bn, representing a 113% increase from H1 2024.