Interview: “Biocides, disinfectants and preservatives are a core business area”

Lanxess has announced a deal to purchase Emerald Kalama Chemical for EUR 867 million (USD 1.04 billion). The deal is one of a series of recent transactions by the Cologne-based company. We spoke to Dr Oliver Kretschik, Vice President Biocides business line, Material Protection Products business unit at Lanxess about the acquisition.

Dr Oliver Kretschik

Why have you decided to acquire Emerald Kalama?

Dr Oliver Kretschik: The businesses of Emerald Kalama Chemical are an ideal fit for our current portfolio. We will be able to further strengthen the consumer protection segment and open up new, growing application areas, for example preservatives for the food and beverage industry.

How will this acquisition strengthen your footprint in the specialty chemicals business in particular?

Kretschik: With a successful acquisition of Emerald Kalama Chemical, we will be able to expand our global business with additional antimicrobial active ingredients and preservatives. The new portfolio will bring important building blocks to Lanxess. It will allow us to participate in the growing demand for organic acids and organic acid derivatives in BPR PT 6 applications, supporting the trend of softer biocides for such uses.

A quarter of the sales of Emerald Kalama Chemical come from the CASE (Coatings, Adhesives & Sealants) and polymers businesses. About 75 % of Emerald Kalama Chemical’s sales are generated with consumer products. These include high quality preservatives for food and beverages as well as cleaning applications and cosmetics. In addition, Kalama offers a wide range of flavours ands fragrances and products for animal nutrition.

Your latest acquisitions were focused on preservatives. Why?

Kretschik: Our latest acquisitions were focused on businesses with consumer protection products. With the acquisition of the French biocide specialist Intace already completed, we have expanded our range of fungicides for paper and packaging. We will be able to significantly expand our portfolio for the growing animal hygiene market with the acquisition of disinfectant and hygiene solutions provider Theseo.

Biocides, disinfectants and preservatives are indeed a core business area for us, in which we see sustainable growth and excellent connecting points for our existing portfolio. We are observing a demand for less packaging and for solutions for longer shelf life as well as higher requirements for hygiene. That’s where our preservation and hygiene solutions come into play.

To what extent are you planning further acquisitions or investments?

Kretschik: In 2021, all signs are pointing to growth for Lanxess, as our CEO Matthias Zachert stated recently. Our company is strongly positioned and has a solid financial base. We can therefore act from a position of strength and participate very actively in M&A activities in the chemical industry. Currently, we are investigating several projects worldwide.

How do you rate the consolidation development in the chemical and coatings industry?

Kretschik: Currently, many companies in the chemical industry are very active when it comes to M&A. Many are realigning their portfolios to focus on their core business. Others have to divest parts of their business due to financial difficulties. However, only companies that are currently strongly positioned can actively participate in industry consolidation.

This interview is part of a longer article on the acquisition which is part of the April issue of the European Coatings Journal.

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