Clariant pursues policy of growth through acquisition

27 May 1996 00:00  [Source: ICB]

A series of small acquisitions will see Clariant established in speciality polymer production, an area in which the group may form a new company division.

Clariant is set to launch into speciality polymer production by making a series of small acquisitions, with the view to creating a fourth company division.

Birgit Kulhoff, analyst at Union Bank of Switzerland in Zurich, said Clariant could spend more than SF500m ($400m) in a new strategy for polymers and this will focus on sectors which have large growth potential.

'The company intends to concentrate acquisitions in the polymers divisions of the masterbatches and additives division and maybe establish a further core area in the production of special polymers,' she added. 'It is more probable that Clariant will opt for several small-sized takeovers rather than one major transaction.'

Engineering and performance polymers are one of the stronger growth markets in Europe but a Clariant spokesman declined to comment on the company's future intentions in the field. 'That is a matter for the imagination,' he said.

Clariant's troubled textile dyes division is also set for restructuring after a dramatic drop in sales figures. This has now bottomed out, says the company, with Europe improving and the Asia-Pacific also showing signs of recovery.

Clariant was in talks with Zeneca about a possible jv in textile dyes but it is believed that the price was too high. 'Ciba, DyStar and BASF [which bought the textile dyes business of Zeneca earlier in May] are much further ahead in restructuring in this area,' said Kulhoff, 'but even these are not a great match.'

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However, one London analyst said he believed Ciba and Clariant were the obvious choice for a deal in textile dyes, despite the base for the industry sector moving to the Far East and Latin America.

The ambitious expansion plans are boosted by group's sales figures for the month of April which showed an increase of 12% on the previous month.

Kulhoff says that with this, and the restructuring on track saving some SF50-60m this year, Clariant is ripe for growth.

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