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HomeCapabilities & ExpertiseClient Impact StoriesMerger Planning and Integration for a Global Specialty Chemical Producer, Resulting in Record Returns from IPO

Merger Planning and Integration for a Global Specialty Chemical Producer, Resulting in Record Returns from IPO

Client Background & Challenges

A private equity-owned global integrated producer of chemicals and advanced materials had over $6 billion in sales. It employed over 9,000 people across 35 locations in the Americas, Europe, and Asia.

Using a total equity stake of several hundred million dollars from a top five private equity firm, the chemical producer went on an aggressive three-year roll-up strategy to build a globally integrated chemical chain. The firm engaged SSA & Company to identify and capture operational synergies, integrate the acquisitions, and develop the ongoing operating platform. The firm lacked a structured internal approach and the necessary capabilities to execute on its global integration strategy, a vital growth initiative.

Approach & Analysis

The team created a robust integration process driven by a combination of five key factors:

  • Creation of a clear and collective understanding of success – Vision
  • Establishment of financial, logistical, and governance targets, focused on driving the right behaviors; “High level” targets were broken down into logical levels (target trees), which fed a function specific activity list, ensuring alignment, transparency, prioritization and measurement – Planning
  • Development of a framework for key personnel to make timely decisions and support the rapid timeframe necessary for integration – Integration Management
  • Development of clear processes, leadership accountabilities, and organizational structures to drive success – Communication
  • Implementation of communication plan along with management control and reporting systems that fostered teamwork and tracked achievement – Execution and Results

Results & Value to Client

Over the course of the three successfully targeted, executed, and integrated acquisitions, our client not only realized its vision of being a globally integrated chemical chain, but also achieved synergies such as:

  • 55% increase in overall productivity
  • $90 million in EBITDA as a direct result of the program or $887 million in total value creation
  • multiple and successive acquisition integration programs, exceeding financial targets in a compressed time-to-value cycle
  • improved profitability and growth within the first year of an integrated operation
  • establishment of new processes in value pricing, product development, customer service, and planning with 15% reduced headcount
  • a controlled and transparent integration system focused on critical activities through the implementation of a management control and reporting system
  • $3 billion generated for investors by the company’s IPO – securing a position in history as one of the largest returns for a private equity firm
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