Chemical compounds: Q2 2012
Chemical compounds is a quarterly analysis of global merger and acquisition (M&A) activity in the chemicals industry. In the report, you'll find an overview of M&A results, significant drivers of these results, and expectations of deal activity in future quarters.
This quarter's analysis revealed:
- Deal volume improved slightly during the second quarter. Deal value, however, declined, driven largely by a significant decrease in mega-deals. Additionally, the global economy continued to slow, particularly in the Eurozone and other advanced economies. Emerging markets, including China and India, slowed as well.
- EBITDA multiples, as measured by median transaction value to EBITDA, improved during the second quarter, driven by healthcare-related deals.
- Asia & Oceania drove local deal value and volume during the first half of the year, and most of these deals were China-based.
- The outlook for the near term remains unpredictable, given the economic uncertainty exhibited during the second quarter. Europe remains a concern, as growth in the region’s chemicals output in 2012 will be weaker than expected due to a slowing economy and inventory trimming. On the plus side, interest rates remain low, and companies have strong balance sheets, particularly cash.