Episode 1320: Think Tank: Strategic investors eye chemicals M&A amid bearish organic growth

The chemicals sector M&A market could see the start of a revival this year, with private equity firms and other strategic investors keen to put war chests of capital to work in a muted growth environment, but political and economic factors remain a concern.In this podcast, ICIS insight editor Tom Brown speaks to Federico Mennella, managing director for industrials at investment bank DC Advisory, about the economic outlook and shifting trends in global chemicals dealflow.Rebound still expected but timing has been pushed back towards the end of the year on trade uncertainty, energy pricing and economic stabilityStrategic investors have war chests of cash and are looking to M&A in difficult organic growth environmentInterest strong for North America chemical sector opportunities due to competitive energy pricingQuestions over whether a financial investor could do something with Europe assets that the current owner cannotPrivate equity continues to drive M&AIncreasing trend for bids for assets not in playMore flexibility in transactions, with investors taking certain assets out of a wider packageGlobal M&A activity has remained below pre-pandemic levels in size and volumeSlight rebound occurring, multiples slightly lowerFinancing costs remain elevated compared to pre-COVID eraDisconnect between buyers and sellers on valuations narrowing