Arkema Sa · EURONEXT:AKE
Arkema Sa — Merger or Acquisition (September 2014)
21 slides from Arkema Sa's merger presentation, Sep 19, 2014
Slide 1: Acquisition of Bostik
Acquisition of Bostik A key milestone in Arkema’s strategy September 19th, 2014
Slide 2: A perfect opportunity
A perfect opportunity Acquisition of Bostik #3 worldwide in adhesives with €1.53bn sales • Attractive adhesives market • Strong leadership positions, brands and technology know-how • Proven earning resilience • Opportunity followed since several years Full alignment with Arkema’s strategy • Accelera
Slide 3: Transaction highlights
Transaction highlights Bostik key figures €1.53bn sales (2014e) €158m EBITDA and 10.3% EBITDA margin Capex: 3% of sales Value creation Cash accretion from first full year; EPS accretive from 2nd year Acceleration of Bostik growth with strong margin improvement planned Well-identified synergies +30%
Slide 4: Bostik at a glance
res Bostik at a glance
Slide 5: Direct exposure to the attractive adhesives market
Direct exposure to the attractive adhesives market Demand by end-market* Growth above GDP • Replacement of traditional fastening Industries Construction solutions • Tapes & labels 25% • Floor • Transport • Tiles • Superior growth of non-woven • Non-woven €33bn 6% • Sealants • Electronics • Construct
Slide 6: Leading positions in diverse end-markets
Leading positions in diverse end-markets Bostik #3 worldwide • Founded in 1889 • Sales by segment: • 55% Industry and Non-woven • Sales: €1.53bn • 45% Construction and Consumer • 4,900 employees Non-woven Industry Consumer Construction Business Global Regional Local model Bostik • #2 worldwide • #3-
Slide 7: A global reach with strong exposure to emerging geographies
A global reach with strong exposure to emerging geographies 45 sites* 40 countries 3 regional R&D centers Global footprint (number of sites by country) Sales by region Europe Compiègne Shanghai R&D center R&D center North America Asia & RoW Europe USA 16 China 7 2 Turkey 2 Increasing penetration Mor
Slide 8: High technology content and powerful brands
High technology content and powerful brands Powerful brands with high client High technology content (B2B) loyalty (B2C) Focus on 3 leading technologies… …with specialized applications ● Highly recognized brands Elastic Bonding ● Stepping-up of Bostik® as a global brand worldwide Hardwood Transporta
Slide 9: Innovation focused business
Innovation focused business R&D spending significantly raised since 2010 Over 10% of sales from products less than 3 years old Implementing several leading R&D centers: Milwaukee, Shanghai, etc. Opening of a R&D global center in Compiègne in Q4 2014 (4,300 sqm and 150 employee capacity) High-potenti
Slide 10: Proven financial resilience with significant upside potential
Proven financial resilience with significant upside potential Sustained sales growth Resilience in downturn Sales (€bn) 2008 – 2009 EBITDA variation (%) 1.5 Chemical 10% Bostik peer* industry 3% CAGR average average 0% 1 Bostik (10%) (20%) Adhesives sector 0.5 2010 2013 Low capital intensity LT obje
Slide 11: Acquisition strategic rationale
Acquisition strategic rationale
Slide 12: Bostik, a new major milestone in Arkema's transformation
Bostik, a new major milestone in Arkema’s transformation A world leader in specialty chemicals and advanced materials Acceleration 2018-2020 of growth • Low GWP Fluorogases 2014-2017 (1234yf, 1233zd) • Furthers acquisitions in • Acrylics in Clear Lake (US) High Performance Materials • Thiochemicals
Slide 13: Excellent strategic fit with Arkema
Excellent strategic fit with Arkema #3 worldwide in adhesives Leadership positions Strong leadership in several growing technologies Global reach with increasing exposure to Global and balanced manufacturing footprint high-growth markets 24% CAGR sales growth in Asia and Latin America vs. 2009 Uniqu
Slide 14: Enhance Arkema's development into a leader in specialty chemicals
Enhance Arkema’s development into a leader in specialty chemicals 2013 sales Pro-forma 2013 sales (including Bostik and Jurong*) High Coating High Coating Performance Solutions Performance Solutions Materials Materials Arkema Industrial Industrial Specialties Specialties Filtration Technical Perform
Slide 15: Reinforce scope of Arkema's leadership positions
Reinforce scope of Arkema’s leadership positions POSITION % SALES #1 Specialty polyamides 13% #1 PVDF #1 Thiochemicals 9% #2 Organic peroxides 4% #2 Fluorogases 9% + #2 PMMA 11% #3 #3 Hydrogen peroxide 4% #3* Acrylics 15% #3 Coatings 22% High Performance Materials Industrial Specialties Coating Solu
Slide 16: Two businesses with strong ties facilitating execution
Two businesses with strong ties facilitating execution Similar DNA facilitating integration and increasing comfort on execution Shared values and high mutual respect Common historical roots • Arkema and Bostik are former subsidiaries of Total chemicals • Arkema management is familiar with Bostik and
Slide 17: A successful track record of Arkema to turn around businesses
A successful track record of Arkema to turn around businesses Successful track record EBITDA margin (%) Bostik target Arkema 15% 14 to 15% 6% 10.3% 2005 2013 Total’s resins Long-term 2014e target 13% (2015 target: 14%) 9% 2010 2013 17 Project subject to the authorization of the relevant antitrust au
Slide 18: A clear roadmap to deliver value
A clear roadmap to deliver value +30% EBITDA at Bostik level over next 3 years Accelerate operational improvements recently implemented at Bostik Increased presence in emerging markets with new plants started in China, Vietnam, India, Egypt Recent acquisitions in US and Brazil Launch of a new logo B
Slide 19: A funding strategy designed to maintain a sound financial profile
A funding strategy designed to maintain a sound financial profile Objective to maintain current rating level Gearing target of 40% by 2017 €1.5bn bridge financing fully underwritten* in place refinanced via: ● €350m rights issue ● €600m to €700m hybrid issue ● €500m to €600m senior bond issuance ● O
Slide 20: A more efficient group portfolio optimization
A more efficient group portfolio optimization 2012 Investor Day 2017 targets plan Already achieved Additional projects Updated plan Jurong’s acrylic Acquisition Acquisitions + €160m EBITDA assets in China* of Bostik + €230m EBITDA €200m sales already Acceleration divested of divestment program • Tin
Slide 21: Disclaimer
Disclaimer The information disclosed in this document may contain forward-looking statements with respect to the financial condition, results of operations, business and strategy of Arkema. Such statements are based on management’s current views and assumptions that could ultimately prove inaccurate