Citation
(2006), "Kline says sale of Air Products Polymers would change competitive landscape for SLPs", Pigment & Resin Technology, Vol. 35 No. 6. https://doi.org/10.1108/prt.2006.12935fab.021
Publisher
:Emerald Group Publishing Limited
Copyright © 2006, Emerald Group Publishing Limited
Kline says sale of Air Products Polymers would change competitive landscape for SLPs
Kline says sale of Air Products Polymers would change competitive landscape for SLPs
Potential buyers for Air Products' polymers business could see themselves leapfrogging to the front of the synthetic latex polymer (SLP) market in both the US and Europe with the purchase of a leading supplier in the vinyl acetate-ethylene (VAE) business.
The company announced its intentions to explore the possible sale of its amines and polymers businesses, and analysts from Kline & Company, a global management-consulting and market-research firm specializing in the chemicals and materials industries, is calling these businesses a smart buy for the right investor.
As the largest US producer of VAE latexes, Air Products Polymers – a joint venture between Air Products and Chemicals, Inc., and Wacker-Chemie GmbH – holds more than 60 percent of the domestic market, according to “Synthetic Latex Polymers Market Analysis,” a series of Kline studies examining global SLP markets and manufacturing. In Europe, Air Products is the second-leading producer of VAE, with a market share of about 40 percent, just behind Celanese.
“With Air Products Polymers' position in VAE in both the US and Europe, whoever ends up buying the business will gain a strong foothold in the overall SLP market,” says Gillian Morris, industry manager of the Chemicals and Materials Practice for Kline's Research Division. “In addition to VAE, they'll also take over Air Products' position in PVAc and vinyl- acetate acrylics.”
VAE is a key component in formulating adhesives and sealants, paints and coatings, and textiles and nonwoven fabrics. Overall, the VAE market is forecast to experience above- average annual growth compared with other SLP products in both the US and in Europe, according to Kline.
The move by Air Products to look for a buyer for the polymers business comes as the company embarks on a plan to enhance its growth strategy, but CEO John Jones has said the company will only sell to a buyer who appreciates the value of the business.
Meanwhile, PolymerLatex, another global leader in the SLP market, is also up for sale. This follows Celanese's purchase of Clariant's emulsions business in 2003 and its acquisition of Vinamul Polymers in February 2005.
“The SLP industry has gone through significant consolidation within the last few years,” says Morris. “It's interesting that there are now two more big SLP producers potentially on the block, each with different product ranges, serving different applications with different regions of focus.”
Kline's “Synthetic Latex Polymers Market Analysis” is a global series of regional analyses that examines the current and forecast demand by major product and end-use industry. To subscribe to any of the volumes in these series, go to www.klinegroup.com/y529y539.htm, or contact Gillian Morris at 630/761.9587 or gillian_morris@klinegroup.com. In Europe, contact Pilar Pardo at +32 2 776 0737 or pilar.pardo@kline-europe.com