2020 Global chemical industry mergers and acquisitions outlook - Clearing the hurdles - Deloitte
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2020 Global chemical industry mergers and acquisitions outlook Clearing the hurdles
2020 Global chemical industry mergers and acquisitions outlook | Contents
Contents
Introduction 4
Trade and geopolitical tensions: the new normal 6
Big oil and SOEs continue moving downstream 7
Sustainability: what’s the M&A impact? 8
Private equity: playing a critical role 9
Mergers and acquisitions activity by chemical sector 10
Mergers and acquisitions activity by geography 12
Summary outlook for 2020 mergers and acquisitions activity 16
Endnotes 17
Contacts 21
Acknowledgements 25
3
2020 Global chemical industry mergers and acquisitions outlook | Introduction
Introduction
Last year, the 2019 Global chemical industry mergers and acquisitions China and Europe,1 which were evident in the M&A market.
outlook (2019 Outlook) predicted that global chemical mergers Cross-border deals between the United States and China nearly
and acquisitions (M&A) activity in 2019 was expected to pull back ceased, and oversupply in key commodities ahead of additional
slightly from 2018 levels against a backdrop of uncertainty— capacity coming online gave petrochemical producers plenty to
comparatively higher interest rates to start the year, increasing worry about besides M&A.
trade and geopolitical tensions, and slowing economic growth in
many key markets. Despite the potential for a decrease in M&A As seen in Figure 1 and 2, global chemical M&A volumes slid
deal volume, it was expected that there would still be a robust modestly in 2019, with volumes down three percent compared
chemicals M&A market in 2019. to 2018, though value was up significantly. The increase in value
was attributable mainly due to Saudi Aramco’s US$69.1 billion
We correctly titled our 2019 Outlook “Navigating headwinds,” as the acquisition of 70 percent of SABIC (which valued SABIC at nearly
chemical industry faced plenty in 2019, including trade tensions US$100 billion)2 and the announced $26.2 billion acquisition of
between the United States and China and slow economic growth in Dupont Nutrition and Biosciences by International Flavors and
Figure 1: Global chemical mergers and acquisitions activity (2010 to 2019)
700 250
600
200
Volume (# of transactions)
500
Value (US$ billions)
150
400
300
100
200
50
100
0 -
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Volume (# of transactions) Value (US$ billions)
Total activity (2010 to 2019)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Volume (# of transactions) 579 646 609 537 635 612 650 637 600 585
Value (US$ billions) 55.6 55.1 41.8 31.8 77.8 145.8 231.1 46.4 72.4 178.3
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
Figure 2: Activity over US$1 billion (2010 to 2019)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Volume (# of transactions) 10 11 11 8 13 16 12 13 16 14
Value (US$ billions) 39.2 36.7 23.8 13.6 52.6 126.3 205.7 29.2 58.8 158.5
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
4
2020 Global chemical industry mergers and acquisitions outlook | Introduction
Fragrances (IFF). After a robust first quarter to start the year in
both volume and value compared to 2018, subsequent quarters fell
off slightly from their prior year’s volumes. The moderate decline in
volumes is likely due to slowing economies, feedstock volatility, and
financial challenges in various chemical industry sectors, but might
also be attributed to the significant amount of capital investment
in new production capacity. Yet despite all these challenges, the
industry achieved a very solid year of M&A activity.
And again this year, we have rumors of further mega-deals to come
in 2020. Notably, for the past two years, there have been various
rumors about a merger between Sinochem and ChemChina.3 While
there does not appear to be a merger of the entire businesses on
the immediate horizon, in January 2020 the two companies did
announce that certain agricultural chemical assets from each of
them, including ChemChina’s Syngenta assets, are expected to
be combined into a common company,4 which may ultimately be
listed through an IPO. There has also been much in the press about
Odebrecht finally selling its shares in Braskem after a potential
deal with LyondellBasell was terminated.5 Roberto Castello Branco,
CEO of Petrobras, another significant shareholder in Braskem, has
reportedly objected to delaying the sale of its shares in Braskem
for two years and would like to move faster.6
As we look to 2020, one wonders whether continued trade
tensions, geopolitical events, and slowing economies will lead to a
further decline in M&A activity. Will the much-discussed topic of
sustainability drive any M&A in the industry? What chemical sectors
will drive M&A activity? Will the increasing challenges faced by the
chemical industry reduce M&A or incentivize players to use M&A to
grow? As some believe we are late in the economic cycle, will chemical
companies and private equity be more hesitant to pull the trigger on
acquisitions? Or will the hesitancy be outweighed by the tailwinds of
abundant capital and low interest rates?
We invite you to read on as we explore and discuss these and
other questions in the 2020 Global chemical industry mergers and
acquisitions outlook: Clearing the hurdles.
5
2020 Global chemical industry mergers and acquisitions outlook | Trade and geopolitical tensions: the new normal
Trade and geopolitical tensions:
the new normal
Dealing with trade and geopolitical risks is definitely not new to the • A likely path forward for a negotiated Brexit following the
chemical industry, which has historically dealt with the inherent Conservative party’s sweeping December victory in the United
risk of its primary feedstock supply coming from the Middle East. Kingdom9
However, in 2019 it seems that some of the geopolitical events
were more acute and the trade tensions were intensifying. In 2019 • Military strikes between the United States and Iran, sending oil
and early 2020 we saw: prices into a temporary frenzy10
• Heightened trade tensions between China and the United States, These events have all led to more economic uncertainty and
including significant tariffs levied on a number of chemical are likely contributing factors to the decrease in 2019 M&A deal
products in each country7 volume. With 2020 being an election year in the United States, a
year that Brexit’s impact appears to be becoming clearer, and with
• The September attack on the Saudi Arabia oil distribution and ongoing tensions in the Middle East, uncertainty may continue to
refining infrastructure impacting supply for major chemical rear its head, providing further hurdles to the year’s M&A activity.
feedstocks8
6
2020 Global chemical industry mergers and acquisitions outlook | Big oil and SOEs continue moving downstream
Big oil and SOEs continue moving
downstream
Similar to the trend we discussed in our 2019 Outlook, this year we companies to compete.13 This could drive further M&A activity as
continued to see the trend of traditional oil and gas companies and petrochemical companies look to shed disadvantaged assets or
state-owned enterprises moving downstream into petrochemicals. move downstream into more specialized intermediates.
Saudi Aramco’s acquisition of a 70 percent stake in petrochemical
producer SABIC,11 2019’s largest chemical deal, was another However, the oversupply of some commodity chemicals has put
example of this continued trend. margin pressures on many producers, potentially dissuading
traditional oil and gas companies from continuing their push into
While oil companies being integrated with downstream petrochemicals.14 While it is yet to be seen whether the temporary
petrochemical production is not new in the industry, chemical glut in capacity in some petrochemicals will discourage further
production is becoming an increasingly important end-use. downstream M&A activity by traditional oil and gas companies in
With fuel demand waning in many developed economies, 2020, there is no question that the changing fossil-fuel demand
petrochemicals, with demand typically projected above GDP dynamics will continue to spur M&A activity in the chemicals
growth, have been the focus for many oil companies.12 industry over the next decade.
This continued push into petrochemicals by oil and gas majors
has many questioning the ability of standalone petrochemical
7
2020 Global chemical industry mergers and acquisitions outlook | Sustainability: what’s the M&A impact?
Sustainability: what’s the M&A impact?
It’s difficult these days to read a news article about the chemical • Eastman Chemical’s partnership with Circular Polymers to
industry or have a conversation with an industry executive without reclaim post-consumer carpeting and recycle it into feedstocks
the topic of sustainability arising. Whether driven by consumer for use in Eastman’s products.16
activism or government policies and regulation, it is hard to deny
that the drive toward sustainability has had and is continuing to The circular economy is starting to provide real economic incentive
have a significant impact on the industry. But has the drive toward as well. As noted in Deloitte’s thought-piece The changing plastics
a more circular economy impacted M&A activity? landscape: Is the chemical industry prepared? there’s a US$120‑billion
market opportunity in the United States and Canada alone for
This question is not easily answered, as examples of headline- plastics and petrochemicals that could be developed by recovering
grabbing M&A that’s been specifically driven by sustainability waste plastics.17 Furthermore, Infoholic Research LLP said in its
are few and far between. However, there is no question that November 13, 2019, report that it expects the recycled plastics
stakeholders’ sustainability concerns are changing how chemical market to grow globally at a 6.8 percent CAGR.18
companies are thinking about their supply chains and business
models. This, in turn, is resulting in more non-traditional M&A As the economic opportunities and incentives continue to
activity in the form of new alliances, partnerships, and joint become clearer, we expect there to be an increase in non-
ventures. Examples include: traditional M&A activity—creating new alliances and ecosystems
that will drive innovation and secure the recycled material supply
• Quality Circular Polymers, the LyondellBasell and SUEZ joint and related infrastructure ultimately needed to capture value in
venture to recycle post-consumer plastic into a high-quality the circular economy.
polypropylene.15
8
2020 Global chemical industry mergers and acquisitions outlook | Private equity: playing a critical role
Private equity: playing a critical role
From a peak in 2015, chemicals acquisition transactions by private continuing need to deploy vast amounts of committed capital
equity groups declined to a post-economic-crisis low in 2018. This (recently reported to total a staggering US$1.5 trillion20).
decline was generally in line with, or slightly ahead of, the overall
decline in M&A deal activity volume. Several transactions in 2019 highlighted these trends. Private
equity groups beat out the competition for marquee assets,
As shown in Figure 3, 2019 saw a modest recovery. In terms of including, for example, Lone Star’s pending acquisition of BASF’s
value, 2019 remained below 2018, but that was almost entirely due Construction Chemicals business21, and Advent’s acquisition of
to the US$12.5 billion Nouryon transaction in 201819—excluding Evonik’s Methacrylates business.22 Private equity was also willing to
that deal, 2019 value was down by only seven percent from the pay up to win prized assets, including, for example, the mid-teen
prior year. EBITDA multiples paid by Arsenal Capital for Clariant’s Healthcare
Packaging business23 and IMM Private Equity’s US$1.2 billion
While there may be several drivers for the decline in private equity purchase of certain assets of Linde in South Korea.24
activity leading to 2018, the most commonly cited reason was the
perception that sector valuations were well above historical norms, Given the robustness of the private equity market as we enter
and such served to dampen financial sponsor interest. Given we 2020, we expect these groups to continue to play a critical role in
have not seen a significant change in sector valuations in 2019, the chemicals M&A—providing capital, acquiring non-core or non-
increased private equity activity this year points, perhaps, to (a) performing assets, and building companies through consolidation
increased aggressiveness by financial sponsors, (b) the realization that will subsequently be sold to corporate acquirers.
that valuations are not going to change any time soon, and (c) a
Figure 3: Global chemical M&A activity — private equity buyers (2010 to 2019)
80 25
70
Volume (# of transactions)
20
60
Value (US$ billions)
50 15
40
30 10
20
5
10
- -
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Volume Value
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
9
2020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by chemical sector
Mergers and acquisitions
activity by chemical sector
As stated previously, M&A activity pulled back slightly in 2019, but Commodity chemicals: Search for growth may drive
still remained strong. Commodity chemical deal volumes increased stronger M&A activity
slightly, but volumes for fertilizers and agricultural chemicals As Figure 4 shows, the volume of commodity chemicals transactions
and specialty chemicals saw the largest decline. In addition to registered a modest uptick in 2019 over 2018; however, volumes are
trade tensions, consolidation that has occurred in the fertilizer still slightly below the 2014 to 2017 period. During 2019, with one
and agricultural sector likely contributed heavily to the declines. prominent exception (Saudi Aramco’s acquisition of a controlling
This section analyzes M&A activity in each chemical sector and interest in SABIC),25 the size of transactions in commodity chemicals
highlights recent trends and transactions. did not exceed US$ 2.5 billion.
Figure 4: Global chemical mergers and acquisitions by target sector (2010 to 2019)
450
400
Volume (# of transactions)
350
300
250
200
150
100
50
-
Commodity chemicals Specialty chemicals Fertilizers and Industrial gases Diversified chemicals
agricultural chemicals
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
Global chemical mergers and acquisitions by target sector (2010 to 2019)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Commodity chemicals 356 376 350 340 383 372 382 387 348 359
Specialty chemicals 145 174 171 132 159 147 185 172 157 148
Fertilizers and agricultural
64 69 66 43 67 72 61 65 77 61
chemicals
Industrial gases 9 12 14 16 15 14 13 10 9 11
Diversified chemicals 5 15 8 6 11 7 9 3 9 6
Total 579 646 609 537 635 612 650 637 600 585
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
10
2020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by chemical sector
As discussed in the 2019 Outlook, a large proportion of investment Fertilizers and agricultural chemicals: Trade tensions
in commodity chemicals continues to go toward organic growth continue to depress cross-border deals
(e.g., new cracker and petrochemical complexes announced by Deal activity in fertilizers and agchems was relatively muted
BASF,26 LyondellBasell-Sinopec,27 and others). in 2019, as we can see in Figure 4. None of the announced
transactions in the sector crossed the US$1 billion threshold, with
Growth in demand for basic chemicals could shrink in 2019, as the year’s largest deal being Sumitomo Chemicals’ acquisition of
forecasts suggest slowed global economic growth.28 However, Nufarm’s Latin American activities for US$802 million.39
some commodity chemical companies might take the opportunity
to use their cash flow for M&A as they seek growth in adjacent The announced combination of ChemChina’s Syngenta and
products and end markets. agricultural chemical businesses from Sinochem is in line to create
another global powerhouse in 2020.40
Additionally, with more petrochemical capacity scheduled to come
on line in 2020, the oversupply and depressed prices for some The US market was impacted by a weak start to the year's growing
petrochemicals could worsen.29 As such, commodity chemical season due to wet weather. Additionally, the ongoing trade dispute
companies will likely spend much of 2020 focused on driving between the United States and China and weak agricultural
efficiencies rather than using M&A to add to capacity. commodity prices have put a damper on sector M&A activity,
which is likely to continue into 2020. While there may be resolution
Intermediates and specialty materials: Significant in certain aspects of the ongoing trade dispute with a “Phase One”
transaction activity volumes and values to continue agreement between the United States and China announced
M&A activity in specialty chemicals appeared to pick up as 2019 in January 2020,41 it remains unclear whether this will have an
progressed—although it ended the year with a six percent immediate impact on demand or whether a return to the status
decrease in volume compared to 2018 (see Figure 4). Valuation quo will drive further consolidation in the sector.
multiples remained particularly strong as acquirors showed a
willingness to pay premium multiples for unique, market-leading Industrial gases: Asia may dominate gas deals in 2020
solutions and franchises. Following last year’s divestitures coming out of the Linde/Praxair42
combination, 2019 industrial gas deal values were significantly
Highlights of the year include: lower than in the recent past, though deal volumes increased. In
addition, most of the deal activity was focused on Asia. The largest
• A continued focus on food flavorings and additives following
deal of the year was the acquisition of certain Linde Korea assets
last year’s US$7.1‑billion acquisition of Frutarom by IFF 30 with
by IMM Private Equity for US$1.2 billion.43
(1) the US$26.2 billion merger of IFF with DuPont Nutrition
and Biosciences,31 (2) Archer Daniels Midland’s US$175 million Given the low likelihood of additional large-scale consolidation
acquisition of the Florida Chemical Company,32 and (3) a US$21 in industrial gases, industry observers expect 2020 activity to be
million acquisition by IFF of The Additive Advantage LLC.33 largely in line with 2019.
• The bidding war between Entegris and Merck for Versum.34 Diversified: Portfolio management driving M&A
Similar to 2018, the diversified chemicals space saw limited deal
• BASF announcing two sizeable specialty chemical divestitures:
activity in 2019 (see Figure 4). The year ended with one sizeable
Construction Chemicals and Pigments.35
announcement: Showa Denko’s tender offer for Hitachi Chemical
• The implied 16.1x multiple paid by Nippon Paint Holdings to for more than US$8 billion.44 Rather than acquiring companies,
acquire DuluxGroup36 for US$3.1 billion as the large players in the many of the larger diversified chemicals companies remain very
coatings industry look to keep pace with many other rivals who active in pruning their portfolios; for example, BASF,45 Clariant,46
have merged in recent years. Dow Chemical,47 DuPont,48 and Evonik49 all sold, or initiated sales
processes, for more than one business during the year, many of
While many of the largest values were evident in acquisitions of which were in the specialty chemical space. At the same time, except
standalone companies, activity in this sector continues to be driven for smaller bolt-ons or technology plays, they were conspicuous by
by acquisitions of products being carved out of larger companies their absence from the list of acquirors in the sector.
as they look to optimize their portfolios. The BASF examples above
are among the largest, but other transactions include the carveout The same level of activity could be evident again in 2020.
of Evonik’s Methacrylates business,37 and Clariant’s sale of its
masterbatches business for US$1.5 billion.38 Portfolio optimization
within the industry has been a continuing trend for many years,
and with valuations for specialty chemicals often exceeding the
value of the combined business, it can be expected that sellers will
continue to look to monetize such assets in order to focus on core
operations.
112020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by geography
Mergers and acquisitions
activity by geography
M&A activity remained strong in 2019. While the volumes of announcements of acquisitions of US chemicals companies than
transactions have stayed relatively flat for most, excluding notable in the first half of the year.50
decreases in the Netherlands and Brazil, the US continues to lead
in terms of value at $41 billion with Japan coming in second at $17 In comparison with the prior year, the total US deal volume
billion. There was a noticeable shift toward Asian markets in 2019. was flat (as shown on Figure 5) thanks to a burst of transaction
Despite the decrease in value in China, values in Japan, Australia announcements in December, while the total value increased
and South Korea showed considerable increases.50 Volumes in significantly due to the mega-merger of DuPont’s Nutrition and
these four countries remained flat or showed a slight increase to Biosciences business unit with IFF.51
show strong growth overall in the region. European markets,
Furthermore, the United States remains the most active market
however, remained relatively consistent with 2018 with strong
for M&A transactions and among the markets with most value
growth in activity in Germany and Sweden50 (not shown on Figure
transacted. Foreign buyers remain very interested in US assets,
5) being offset by a slowing of transactions in other western
with European acquirers the most active. As for Asian buyers,
European countries such as France50 (not shown in Figure 5), Italy50
similar to the recent past, Chinese inbound activity was extremely
(Not shown in Figure 5), and the Netherlands. South American
low in 2019.50 However, Japanese and Korean groups have been
activity continues to be led by Brazil, which pulled back in 2019 to
increasingly aggressive in pursuing American chemical assets.
its lowest level in the last 10 years.
Portfolio management remained an important theme for US
United States: Momentum from the
chemicals companies, with several sizeable divestitures by the
second half of 2019 to continue in 2020
likes of Huntsman (Intermediates and Surfactants),52 Ashland
2019 US chemicals M&A activity got
(Composites and BDO),53 DuPont (Nutrition and Biosciences),54 and
off to a relatively slow start, driven
Ecolab (ChampionX)55 announced during the year. At the same time,
in part by factors evident toward the end of 2018, including
strategics continued to acquire targets that bolstered their core
interest rates that were comparatively higher than in the years
business. Private equity groups remained important participants in
immediately following the financial crisis, stock market volatility,
the sector as both acquirers and sellers of businesses.
and increasing trade tensions. Deal activity picked up as interest
rates and the stock market moderated over the course of the Given the current strength of the economy and stock market,
year, or as investors chose to look past trade tensions. In fact, one would anticipate continued strength in US chemicals M&A
the last six months of 2019 saw approximately one third more activity in 2020.
Figure 5: Global chemical merger and acquisitions activity by target market (2010 to 2019)
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
United States 165 197 204 160 206 186 201 196 180 180
China 57 50 50 48 70 78 72 89 82 82
United
35 29 37 27 35 33 41 33 29 30
Kingdom
Germany 37 28 44 37 44 37 38 41 28 40
India 17 27 10 20 17 23 28 15 28 21
Netherlands 14 11 14 6 8 11 19 8 21 9
Japan 11 20 15 14 15 20 12 11 15 14
Brazil 12 18 23 15 12 10 24 14 16 4
Other 231 266 212 210 228 214 215 230 201 205
Total 579 646 609 537 635 612 650 637 600 585
Source: Deloitte Development LLC analysis of data from S&P Capital IQ. Data is from January 1, 2010, to December 31, 2019.
122020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by geography
China: Domestic consolidation efforts Outbound M&A from UK corporates was also in evidence, albeit
will drive M&A at a much lower level than in 2018 with deal volumes dropping
Deal volumes were flat in 2019, while by more than 50 percent compared to the prior year, reflecting
value decreased back down to 2017 levels caution in the face of Brexit uncertainties. For those venturing
after almost doubling from 2017 to 2018. abroad, strategies included expanding geographical footprints
This dip is due to the absence of mega-deals in 2019. However, and increasing exposure to growth end-markets, accessing higher-
as expected, there was a number of smaller-sized deals as margin products, and filling gaps in product portfolios.
consolidation continued in China. For 2020, the impact of the US-
China trade dispute and ongoing, though slightly less restrictive, As the industry moves into a period of potential uncertainty,
capital controls in China will likely keep overseas acquisitions by continued caution toward M&A may be expected in the UK
Chinese buyers at continued low levels that may be comparable chemicals market. However, an uptick in carve-outs may be
to 2019. M&A in the chemicals industry will remain a domestic expected to continue as big players aim to become more and more
play like in 2019, where over 70 percent of the deals were focused, providing opportunities for purchasers of the non-core
between domestic buyers and sellers. Inbound acquisitions by businesses. Furthermore, with debt still relatively cheap and both
foreign buyers may increase for two reasons: 1) the consolidation corporates and private equity having cash to deploy, conditions for
in all Chinese chemicals sectors keeps momentum, and liquidity UK M&A are expected to remain supportive into 2020, pending any
issues of small and mid-sized players creates opportunities; and impacts of a final Brexit agreement.
2) pricing levels for domestic IPOs, an important price guide for
Germany: Trend toward differentiation to drive
local sellers, are expected to remain at levels comparable to 2019.
M&A activity
Acquisition opportunities in China in the chemicals industry will
Despite the increasing economic uncertainty and an
therefore not be cheap, but given the current adjustments in
automotive slowdown impacting demand within the
the Chinese economy, there may be additional opportunities for
chemicals industry, M&A transactions in the German
foreign buyers. Other than the announced merger of agricultural
chemicals industry was up in 2019 versus 2018, in terms of both
chemical assets of Sinochem and ChemChina,56 large deals are
transaction value and volume. In addition to supportive economic
not likely as the industry is dominated by state-owned players,
conditions and debt markets, key drivers for the very solid activity
with typical deal sizes likely to be US$50–150 million for the
level were mostly strategic considerations of the industry players,
majority of inbound transactions.
driven by trends such as globalization, digitalization, and increasing
We do not note a trend toward any particular sector within commoditization. Germany continues to be a significant player in
chemicals, with consolidation taking place across all sectors. China the international deal space, second only to the United States in
is traditionally home to the world's largest base chemicals capacity, outbound cross-border deals.
which drives activity levels. Recently there have been increasing
As in the last few years, most transactions were driven by
price pressures from customers and cost pressures from
strategic players, pushing to improve or maintain their portfolio
increasingly strict environmental regulations. Domestic
value—either by acquiring new capabilities or by divesting non-
transactions are up more than 25 percent year over year, which is
core assets. German chemical companies were mostly targeting
due, in part, to companies looking to gain scale to better leverage
innovative, differentiated technologies that will accelerate profit
these higher regulatory compliance costs.
and growth in the years to come. One divestiture which is not
United Kingdom: Slight uptick in M&A as overseas focused on chemical production but is instead focused on the
inbound appetite remains strong operation of chemical plants was the announced sale of Currenta,
As Brexit uncertainty continued to weigh on business a chemical park operator, by shareholders Bayer and LANXESS
confidence, UK chemicals M&A activity was relatively to funds managed by Macquarie Infrastructure and Real Assets
flat compared to 2018, with both volumes and values up (MIRA) for US$3.9 billion.57 This highlights a growing trend by
just slightly. International interest in UK companies continued, with chemical firms to sell land and/or include the site services when
investors from France, Germany, and North American countries carving out individual production units or plants from larger
particularly active. As in 2018, the speciality space proved popular, chemical complexes so that the proceeds can be invested in higher
especially companies serving the personal-care sector. growth or value adding solutions. We have observed site services
or operating agreements being a critical piece of negotiations for
Corporates made up the majority of the acquirers, despite a transactions involving chemical plants globally due to differing
strong global private equity market supported by cheap debt valuation multiples from the production multiples and potential
and record levels of dry powder. The number of private equity volatility in earnings associated with site services.58
exits of UK companies also declined, potentially attributed to
companies holding on to assets in the hope of an improved At the same time, businesses with an increased degree of
backdrop post-Brexit. commoditization were often divested by German strategic players.
Those more commoditized businesses were mostly purchased by
132020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by geography
global private equity companies—partly also by foreign strategic policies, the uncertainty surrounding the unanticipated economic
acquirers that want to build a globally leading market share slowdown in 2019 may delay the M&A deals in the pipeline, which
(e.g., the pigments value chain). In addition, the Bayer-Monsanto may cause a slow start to activity in 2020 with increased activity
transaction is still impacting the German market through only in the latter part of the year.
continued divestitures.59
Netherlands: Macro conditions support growth in
Going into 2020, one might expect that the growing uncertainty M&A volumes
and the possible economic downturn could lead to a mild After the record year of 2018, chemical M&A activity
slowdown in M&A activity, especially as regulatory scrutiny has in the Netherlands slowed down in 2019. The number
tightened significantly in Europe. of deals dropped to nine (from 21), and the total value of these
transactions was just over US$400 million, compared to US$14.7
India: Slower growth may hinder M&A activity billion in 2018, which was driven by two multi-billion-dollar
despite industry-friendly reforms and robust deals.50 The largest transaction of 2019 was the acquisition of
long-term growth outlook BRB International by Malaysia-based Petronas Chemicals for
The Indian economy’s growth rate declined slightly approximately US$182 million.65
from 6.8 percent GDP growth in 2018 to 6.1 percent in 2019, and
is projected to grow at seven percent in 2020.60 With the ruling The macro drivers for M&A activity in the Netherlands remain quite
government gaining a clear majority in the central government positive. However, despite a strong economic climate, relatively
elections, the Indian market expects faster reforms for growth and inexpensive debt, and increasing cash on hand, the market
development supported by prevailing favorable macroeconomic sentiment continues to be less than optimistic. A number of
conditions. India’s foreign exchange reserves grew to US$451 companies in Western Europe have had a disappointing 2019 in
billion, compared to US$393 billion at the end of 2018,61 its ranking terms of growth and earnings, partly driven by a sluggish
in the World Bank’s Ease of Doing Business ratings improved from automotive sector and uncertainty around global trade.
142 in 2014 to 63 in 2019,62 and inflation continues to be in control. Additionally, the CO2-emission discussion became very vivid in the
India is also poised to become the world’s fifth-largest economy, second half of 2019 and will likely continue in 2020. These factors
with a GDP of US$2.93 trillion, having surpassed the United may have a negative effect on the investment climate across many
Kingdom and France in 2019.63 industries and in the chemical industry in particular. Further, these
effects are not expected to go away soon and may dampen 2020
Chemicals M&A deal value in India rose by US$500 million in 2019, M&A activity.
though deal volumes decreased by 25 percent as compared to
2018 as the economy’s growth rate began to slow. In the wake of Japan: High appetite for M&A despite an
the mild growth slowdown experienced in 2019, India announced economic downturn
industry-friendly reforms, including reducing corporate tax In 2019, many leading chemical companies in Japan
rates from 35 to 25 percent, and from 25 to 15 percent for new experienced weaker results due to a variety of
manufacturing companies, and liberalising guidelines for external negative factors, including an increase in trade tensions and tariff
commercial borrowing and foreign direct investment. India is hikes between the United States and China, a decline in business
also planning to make changes to its Petroleum, Chemicals, and confidence, and a tightening of monetary conditions, following
Petrochemicals Investment Region (PCPIRs) policy to attract 2018 when almost all major chemical companies enjoyed record
further investments. With the country’s growing population and earnings. Against this backdrop, Japan remained active in the M&A
increasing per-capita income, the chemical industry’s biggest market. In fact, while deal volumes remained flat, values for
advantage is the growing domestic consumption across all sub- acquisitions of Japanese targets increased to nearly US$17 billion
sectors. Further to the cluster approach of the PCPIRs, which are as a result of two large domestic transactions.50 Outbound M&A
attracting significant investments, the government has rolled out was evident throughout the year with two deals over US$1 billion,
a scheme to establish Plastic Parks across the country.64 Plastic reflecting the business-critical need to rapidly expand overseas to
Parks would have common infrastructure to support plastic offset a declining domestic market. In addition, in this downturn,
production plants and to ensure environmentally sustainable companies have a continuing need to accelerate portfolio
growth through innovative methods. transformation, which many businesses are currently tackling.
Japan M&A activity levels will likely remain consistent in 2020,
While domestic commodity players are looking to foray into though deal values may slide back to historical levels.
specialty chemicals, many global players are evaluating acquisitions
in India with a long-term objective; the agricultural chemicals sub- Brazil: M&A activity growth expected in 2020
sector has matured quite well with almost 50 percent exports, and Despite the overall growth in Brazilian M&A
the fertilizers market is growing at a decent pace.50 transactions in 2019,66 activity in the chemical sector
fell below expectations for several reasons. First,
Although the environment is conducive for chemical industry major acquisition deals did not go through, including the sales of
growth in India based on growing consumption, a stable Braskem67 and two agricultural chemical plants of Petrobras.68
government, tax and investment reforms, and chemical cluster Additionally, productivity stagnation, a trade balance deficit,
142020 Global chemical industry mergers and acquisitions outlook | Mergers and acquisitions activity by geography
political uncertainty from delayed domestic reforms, and the Taking into consideration the privatization agenda undertaken
Bolivian political crisis, which threatened the supply of natural by the Brazilian government and Petrobras’s divestment plan for
gas for chemical feedstocks, all likely hindered M&A in Brazil’s 2019–2023, which includes downstream chemical assets,72 one
chemical industry. may anticipate that the chemical industry will see relevant and
valuable deals this year. Commodity chemicals as well as fertilizers
Nonetheless, there is reason to expect M&A growth in 2020. GDP and agricultural chemicals are likely to be the main targets within
growth is projected to be 2.2 percent,69 a 1.3-percentage-point the industry. In addition, companies related to sustainable
increase from the previous year, which may translate into higher practices and innovation may be increasingly targeted, as seen
demand for chemicals and higher industrial productivity, impacting in 2019 in the Raízen Energia (Cosan and Shell’s joint venture)
both profitability and attractiveness of chemical plants. Moreover, acquisition of stakes from Cosan Biomass,73 a company dedicated
interest rates in Brazil have reached a historic low at 4.5 percent70 to selling straw and bagasse from sugarcane for experiments, and
along with a currency that will probably remain depreciated71 in the takeover of a recycling plant by Globalpack, a major plastic
relative to many key currencies, which may further stimulate packing solutions company.74
investments and thus propel M&A activity.
152020 Global chemical industry mergers and acquisitions outlook | Summary outlook for 2020 mergers and acquisitions activity
Summary outlook for 2020 mergers
and acquisitions activity
Despite the recent modest dips in M&A volumes over the past countries, but perhaps has benefitted other Asian countries that
few years, the chemical industry continues to enjoy robust M&A stepped in to fill the unmet needs resulting from trade differences.
activity. Activity levels have remained strong through trade and
geopolitical tension, economic uncertainty, and slowing growth The fundamentals for M&A activity in the chemical industry
rates. It appears that the industry has grown more comfortable continue to be strong as well. Companies are searching for growth,
operating in increasing uncertainty, and that the basic objectives of a larger global footprint, a more focused or more cost-efficient
growth and profitability have gained importance—operating in an operation, and innovative solutions. Shareholder activists continue
uncertain world is now the “new normal.” to be a mainstay in the chemical industry and to spur activity by
proposing changes to the business portfolio. Additionally, many
While we have observed a re-direction of cash into new and sectors within the chemical industry remain fragmented, providing
more efficient capacity building, particularly in the United States opportunities for consolidators to create value through M&A.
to leverage advantaged shale gas feedstocks, allocating funds
to execute strategy through M&A continues to be a priority for Over the past years, we have observed the chemical industry’s
chemical industry players. continued strength in M&A activity. We expect that 2020 will bring
new opportunities and new challenges to the deal market. But
The global economy appears poised to support continued M&A barring a global geopolitical or economic event, chemical M&A
activity. Though the World Bank trimmed its forecasts for 2019 activity may mimic that observed in 2019 with upside benefit if
and 2020 growth, it appears that improved growth is expected current trade and geopolitical tensions ease. Though obstacles
in 2020—2.5 percent globally.75 Geopolitical tensions and trade continue to arise that might otherwise hamper M&A, the chemical
disagreements have continued to impede economic growth. industry continues to demonstrate that it has the strength to clear
The China/US trade dispute has taken its toll on growth in both the hurdles.
162020 Global chemical industry mergers and acquisitions outlook | Endnotes
Endnotes
1 Paul Hannon, Tom Fairless, and Megumi Fujikawa, “Global Public Investment Fund of Saudi Arabia,” March 27, 2019,
economic powerhouses stuck in low gear,” Wall Street Journal, https://www.saudiaramco.com/en/news-media/news/2019/
November 14, 2019, https://www.wsj.com/articles/growth-in- aramco-sabic.
economic-powerhouses-starts-to-diverge-11573730840.
12 Alexander H. Tullo, “Why the future of oil is in chemicals, not
2 Saudi Aramco, “Saudi Aramco signs share purchase fuels,” Chemical and Engineering News, February 20, 2019,
agreement to acquire 70% majority stake in SABIC from the https://cen.acs.org/business/petrochemicals/future-oil-
Public Investment Fund of Saudi Arabia,” March 27, 2019, chemicals-fuels/97/i8.
https://www.saudiaramco.com/en/news-media/news/2019/
aramco-sabic. 13 Joseph Chang, “CP Chem/NOVA talk underscores Big Oil's
push,” Independent Commodity Intelligence Services (ICIS),
3 David Stanway, “Sinochem chairman says merger with July 8, 2019, https://www.icis.com/explore/resources/
ChemChina still underway,” Reuters, November 6, 2019, news/2019/06/27/10384296/cp-chem-nova-talk-underscores-
https://www.reuters.com/article/us-sinochem-chemchina- big-oil-s-push.
merger/sinochem-chairman-says-merger-with-chemchina-
still-underway-idUSKBN1XG151. 14 Deloitte, 2019, https://www2.deloitte.com/us/en/pages/
energy-and-resources/articles/oil-and-gas-industry-and-
4 Reuters, “ChemChina, Sinochem merge agricultural assets: chemicals-industry-outlook.html.
Syngenta,” January 5, 2020, https://in.reuters.com/article/us-
chemchina-sinochem-syngenta/chemchina-sinochem-merge- 15 LyondellBasell, “LyondellBasell and SUEZ collaborate with
agricultural-assets-syngenta-idINKBN1Z40FZ. Samsonite to create recycled plastic suitcase collection,”
April 19, 2019, https://www.lyondellbasell.com/en/news-
5 Reuters, “LyondellBasell ends talks with Odebrecht to buy events/corporate--financial-news/lyondellbasell-and-suez-
Braskem,” June 4, 2019, https://www.reuters.com/article/ collaborate-with-samsonite-to-create-recycled-plastic-
us-braskem-m-a-lyondell/lyondellbasell-ends-talks-with- suitcase-collection/.
odebrecht-to-buy-braskem-idUSKCN1T51BH.
16 Eastman, “Eastman to recycle discarded carpet into new
6 Reuters, “CEO of Brazil's Petrobras objects to delay in materials,” November 5, 2019, https://www.eastman.com/
Braskem sale,” December 6, 2019, https://in.reuters.com/ Company/News_Center/2019/Pages/Eastman-to-recycle-
article/petrobras-strategy-braskem-idINE5N27L010. discarded-carpet-into-new-materials.aspx.
7 Jean-François Tremblay, “Chemicals are caught up in U.S.- 17 Deloitte, 2019, https://www2.deloitte.com/content/dam/
China trade war,” Chemical & Engineering News, June 20, Deloitte/us/Documents/energy-resources/us-the-changing-
2018, https://cen.acs.org/policy/trade/Chemicals-caught-US- single-use-plastics-landscape.pdf.
China-trade/96/i26.
18 Clare Goldsberry, “Solid growth projected for recycled
8 Will Beacham, “Saudi drone attacks threaten around 10% plastics market,” Plastics Today, January 9, 2020, https://www.
of global ethylene capacity,” Independent Commodity plasticstoday.com/recycling/solid-growth-projected-recycled-
Intelligence Services (ICIS), September 16, 2019, https://www. plastics-market/54733249462196.
icis.com/explore/resources/news/2019/09/16/10417877/
saudi-drone-attacks-threaten-around-10-of-global-ethylene- 19 The Carlyle Group, “AkzoNobel closes sale of Specialty
capacity. Chemicals to The Carlyle Group and GIC,” October 1 2018,
https://www.carlyle.com/media-room/news-release-archive/
9 BBC News, “Election results 2019: Boris Johnson returns to akzonobel-closes-sale-specialty-chemicals-carlyle-group-and-
power with big majority,” December 13, 2019, https://www. gic.
bbc.com/news/election-2019-50765773.
20 Kate Rooney, “Private equity’s record $1.5 trillion cash pile
10 Devika Krishna Kumar, “Oil prices jump after U.S. air strike comes with a new set of challenges,” CNBC, January 31, 2019,
kills top Iranian commander,” January 2, 2020, https://www. https://www.cnbc.com/2020/01/03/private-equitys-record-
reuters.com/article/us-global-oil/brent-jumps-nearly-3-after- cash-pile-comes-with-a-new-set-of-challenges.html.
u-s-air-strike-kills-iran-iraq-officials-idUSKBN1Z2030.
21 BASF, “Lone Star Funds to acquire BASF’s Construction
11 Saudi Aramco, “Saudi Aramco signs share purchase Chemicals business,” December 21, 2019, https://www.basf.
agreement to acquire 70% majority stake in SABIC from the com/global/en/media/news-releases/2019/12/p-19-421.html.
172020 Global chemical industry mergers and acquisitions outlook | Endnotes
22 Advent International, “Advent International acquires Evonik 32 ADM, “ADM adds industry-leading citrus capabilities to flavor
Industries’ methacrylates business,” March 4, 2019, https:// portfolio with acquisition of Florida Chemical Company,”
www.adventinternational.com/advent-international-acquires- January 11, 2019, https://www.adm.com/news/news-releases/
evonik-industries-methacrylates-business/. adm-adds-industry-leading-citrus-capabilities-to-flavor-
portfolio-with-acquisition-of-florida-chemical-company.
23 Clariant, “Clariant signs an agreement regarding the sale of its
healthcare packaging business," July 22, 2019, https://www. 33 IFF, “IFF acquires additive, advantage expands scent taste and
clariant.com/en/Corporate/News/2019/07/Clariant-signs-an- actives,” February 19, 2019, https://ir.iff.com/news-releases/
agreement-regarding-the-sale-of-its-Healthcare-Packaging- news-release-details/iff-acquires-additive-advantage-
Business. expands-scent-taste-and-actives.
24 Linde, “Linde completes divestiture of selected Korean 34 Reuters, “Merck KGaA goes hostile in $5.9 billion Versum
assets,” April 30, 2019, https://www.linde.com/en/news- takeover battle,” March 26, 2019, https://www.reuters.com/
media/press-releases/2019/linde-completes-divestiture-of- article/us-versum-materials-m-a-merckkgaa-bid/merck-
selected-korean-assets. kgaa-goes-hostile-in-5-9-billion-versum-takeover-battle-
idUSKCN1R714D.
25 Saudi Aramco, “Saudi Aramco signs share purchase
agreement to acquire 70% majority stake in SABIC from the 35 BASF, “Lone Star Funds to acquire BASF’s Construction
Public Investment Fund of Saudi Arabia,” March 27, 2019, Chemicals business,” December 21, 2019, https://www.basf.
https://www.saudiaramco.com/en/news-media/news/2019/ com/global/en/media/news-releases/2019/12/p-19-421.html;
aramco-sabic. and BASF, “DIC to acquire BASF’s global pigments business,”
August 29, 2019, https://www.basf.com/global/en/media/
26 BASF, “BASF and SINOPEC sign Memorandum of news-releases/2019/08/p-19-312.html.
Understanding to expand cooperation in China,” October
29, 2018, https://www.basf.com/global/en/media/news- 36 Dulux Group, “Dulux Group board unanimously recommends
releases/2018/10/p-18-358.html. acquisition proposal,” April 17, 2019, http://www.duluxgroup.
com.au/ArticleDocuments/10262/ASX%20announcement%20
27 LyondellBasell, "LyondellBasell and Sinopec announce -%2017042019.pdf.aspx.
joint venture to manufacture propylene oxide and styrene
monomer in China," December 23, 2019, https://www. 37 EVONIK, “Evonik closes sale of Methacrylates business,”
lyondellbasell.com/en/news-events/corporate--financial- August 1, 2019, https://corporate.evonik.com/en/media/
news/lyondellbasell-and-sinopec-announce-joint-venture- press_releases/performance-materials/pages/article.
to-manufacture-propylene-oxide-and-styrene-monomer-in- aspx?articleId=109129.
china/.
38 “Clariant has agreed to sell its Masterbatches business for
28 International Monetary Fund, “World economic outlook approx. USD 1.6 Billion,” December 19, 2019, https://www.
update, January 2019,” January 2019. https://www.imf.org/ clariant.com/en/Corporate/News/2019/12/Clariant-has-
en/Publications/WEO/Issues/2019/01/11/weo-update- agreed-to-sell-its-Masterbatches-business-for-approx_-USD-
january-2019. 1_6-billion.
29 Will Beacham, “Global PE faces even more new capacity in 39 Nufarm, “Sale of Nufarm South America to Sumitomo for
2020, oversupply, poor margins,” Independent Commodity $1,188 million,” September 30, 2019, https://nufarm.com/wp-
Intelligence Services (ICIS), December 19, 2019, https://www. content/uploads/2019/09/ASX-release_LATAM_final.pdf.
icis.com/explore/resources/news/2019/12/19/10454460/
global-pe-faces-even-more-new-capacity-in-2020-oversupply- 40 Reuters, “ChemChina, Sinochem merge agricultural assets:
poor-margins. Syngenta,” January 5, 2020, https://in.reuters.com/article/us-
chemchina-sinochem-syngenta/chemchina-sinochem-merge-
30 International Flavors and Fragrances, “IFF’s Frutarom division agricultural-assets-syngenta-idINKBN1Z40FZ.
completes acquisition 60% of Thailand-based Mighty, January
18, 2019, https://ir.iff.com/news-releases/news-release- 41 Bob Davis, Lingling Wei, and William Mauldin, “U.S., China sign
details/iffs-frutarom-division-completes-acquisition-60- deal easing trade tensions,” Wall Street Journal, January 16,
thailand-based. 2020, https://www.wsj.com/articles/u-s-china-to-sign-deal-
easing-trade-tensions-11579087018?mod=hp_lead_pos1.
31 Dupont, “IFF to Merge with DuPont’s Nutrition &
Biosciences Business,” December 15, 2019, https://www. 42 Linde, "Business Combination Between Praxair and Linde
dupontnutritionandbiosciences.com/news/iff-to-merge-with- AG Successfully Completed," October 31, 2018, https://www.
dupont-nutrition-biosciences-business.html. linde.com/en/news-media/press-releases/2018/business-
combination-between-praxair-and-linde-ag-successfully-
completed.
182020 Global chemical industry mergers and acquisitions outlook | Endnotes
43 Linde, “Linde completes divestiture of selected Korean Intermediates and Surfactants Businesses to Indorama
assets,” April 30, 2019, https://www.linde.com/en/news- Ventures for $2 Billion,” January 5, 2020, https://ir.huntsman.
media/press-releases/2019/linde-completes-divestiture-of- com/news-releases/detail/425/huntsman-completes-the-
selected-korean-assets. sale-of-its-chemical-intermediates.
44 Yuki Furukawa and Takako Taniguchi, “Showa Denko 53 Ashland Corporation, “Ashland signs definitive agreement
Unveils $8.8 Billion Deal for Hitachi Chemical,” Bloomberg, to sell Composites business and butanediol facility in Marl,
December 17, 2019, https://www.bloomberg.com/news/ Germany, to INEOS Enterprises for $1.1 billion,” November
articles/2019-12-18/showa-denko-unveils-8-8-billion-deal-to- 15, 2018, https://investor.ashland.com/news-releases/
buy-hitachi-chemical. news-release-details/ashland-signs-definitive-agreement-sell-
composites-business-and.
45 BASF, “Lone Star Funds to acquire BASF’s Construction
Chemicals business,” December 21, 2019, https://www.basf. 54 Dupont, “IFF to Merge with DuPont’s Nutrition &
com/global/en/media/news-releases/2019/12/p-19-421.html; Biosciences Business,” December 15, 2019, https://www.
and BASF, “DIC to acquire BASF’s global pigments business,” dupontnutritionandbiosciences.com/news/iff-to-merge-with-
August 29, 2019, https://www.basf.com/global/en/media/ dupont-nutrition-biosciences-business.html.
news-releases/2019/08/p-19-312.html.
55 Ecolab, “Ecolab Announces Plan to Spin off Its Upstream
46 Clariant, “Clariant has agreed to sell its Masterbatches Energy Business as an Independent Public Company; Expects
business for approx. USD 1.6 Billion,” December 19, 2019, Fourth Quarter 2018 Diluted EPS of $1.48, with Adjusted
https://www.clariant.com/en/Corporate/News/2019/12/ Diluted EPS of $1.54; Forecasts 10%-14% Full Year 2019
Clariant-has-agreed-to-sell-its-Masterbatches-business-for- Adjusted EPS Growth,” February 4, 2019, https://www.ecolab.
approx_-USD-1_6-billion. com/news/2019/02/ecolab-announces-plan-to-spin-off-
its-upstream-energy-business-as-an-independent-public-
47 Trinseo, “Trinseo to acquire latex binders assets in Germany,” company-exp.
May 2, 2019, https://www.trinseo.com/News-And-Events/
Trinseo-News/2019/May/Trinseo-to-Acquire-Latex-Binders- 56 Reuters, “ChemChina, Sinochem merge agricultural assets:
Assets-in-Germany; and Altivia, “Altivia acquires Dow’s Syngenta,” JAN 5, 2020, https://in.reuters.com/article/us-
acetone derivatives business,” August 13, 2019, https:// chemchina-sinochem-syngenta/chemchina-sinochem-merge-
www.altivia.com/pressroom/altivia-acquires-dow-s-acetone- agricultural-assets-syngenta-idINKBN1Z40FZ.
derivatives-business-1-1.
57 Bayer, “Bayer completes sale of Currenta state to Macquarie
48 Kiel Porter, Myriam Balezou, and Rick Clough, “Dupont is said Infrastructure and Real Assets, November 29, 2019, https://
to explore divestiture of transportation unit,” Bloomberg, media.bayer.com/baynews/baynews.nsf/ID/Bayer-completes-
November 7, 2019, https://www.bloomberg.com/news/ sale-of-Currenta-stake-to-Macquarie-Infrastructure-and-Real-
articles/2019-11-07/dupont-is-said-to-explore-divestiture-of- Assets.
transportation-unit; and Dupont, “IFF to Merge with DuPont’s
Nutrition & Biosciences Business,” December 15, 2019, 58 Deloitte observation.
https://www.dupontnutritionandbiosciences.com/news/iff-to-
59 Bayer, “History of Bayer 2010–2018,” 2018, https://www.bayer.
merge-with-dupont-nutrition-biosciences-business.html.
com/en/2010-2018.aspx.
49 EVONIK, “Evonik closes sale of Methacrylates business,”
60 International Monetary Fund, “More fiscal transparency would
August 1, 2019, https://corporate.evonik.com/en/media/
mean better economic policy in India,” December 23, 2019,
press_releases/performance-materials/pages/article.
https://www.imf.org/en/News/Articles/2019/12/12/na121219-
aspx?articleId=109129.
more-fiscal-transparency-would-mean-better-economic-
policy-in-india.
50 Deloitte Development LLC analysis of data from S&P Capital 61 Reserve Bank of India, “Weekly Statistical Supplement,”
IQ. Data is from January 1, 2010, to December 31, 2019. Accessed in December 2019, https://m.rbi.org.in/Scripts/
WSSViewDetail.aspx?TYPE=Section&PARAM1=2.
51 Dupont, “IFF to Merge with DuPont’s Nutrition &
Biosciences Business,” December 15, 2019, https://www. 62 “India ranks 63 in World Bank’s Doing Business Report:
dupontnutritionandbiosciences.com/news/iff-to-merge-with- India improves rank by 14 positions,” Government of India
dupont-nutrition-biosciences-business.html. Department for Promotion of Industry and Internal Trade,
October 24, 2019, https://dipp.gov.in/sites/default/files/Press_
52 Huntsman, “Huntsman Completes the Sale of its Chemical Release_Doing_Business_Report_2020_dated_24102019.pdf.
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