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Global Personal Care and Cosmetic Ingredients Industry Consolidation, 2018

  • Report

  • 76 Pages
  • November 2018
  • Region: Global
  • Frost & Sullivan
  • ID: 4702500

Mergers and Acquisitions to Drive Market Growth

This growth insight is an analysis of the global personal care and cosmetic ingredients industry consolidation. It profiles notable transactions with case studies and examines the rationale for mergers and acquisitions (M&As) in the personal care and cosmetic ingredients market. It also discusses the key market drivers and restraints for M&A activity. The report provides transformation in the personal care and cosmetic ingredients ecosystem, models several growth opportunities that involves consolidation, with strategic imperatives.

The personal care and cosmetic ingredients include synthetic, natural, multifunctional, and others. Growth by acquisition, innovation, customer service leadership, and value addition are some of the strategies adopted by ingredient suppliers. Vertical integration and sideward integration are also aimed at to earn higher margins  and to expand product line respectively. Companies are increasing their global reach by acquiring companies for synergies of geographical markets, technologies and products, and even distribution channels.

Industry Trends:

  • Personal care and cosmetic ingredients face highly competitive price pressures, leading to the need mergers with or the acquisition of competitors to achieve cost leadership by expanding technological innovation and diversification strategies.
  • A majority (80-90%) of the personal care and cosmetic active ingredients are commodities or reaching commodity status, and thus innovation in products and technologies is an urgent requirement for growth.
  • Consolidation is reshaping the industry as leading competitors acquire and assimilate target companies with compatible products and technologies.

Growth Opportunities:

  • Product portfolio diversification through acquisitions is a key differentiator
  • Customer preference for one-stop shop solution providers
  • Increased funding interest from private equity firms
  • The industry remains fragmented with a number of successful start-ups and entrepreneurial set-ups that are profitable as small businesses, prompting M&A activities.

Top M&A Companies: Acquisitions by Greentech of Mapric, Givaudan of Induchem, IFF of Lucas Myer and Aromor, are aimed at gaining access to complementary and supplementary portfolios. Examples of acquisitions for accessing natural products are Seppic’s takeover of Serdex, Clariant acquiring CRM International and 17% stake of BioSpectrum, Takasago’s buying out of Centre Ingredient Technology and Givaudan’s acquiring of Soliance.

Key Issues Addressed

  • What are the key factors driving M&A in the personal care and cosmetic ingredients market?
  • What are the influential factors that have led companies to decide on acquisition strategies during 2014–2018?
  • How has acquisitions impacted the personal care and cosmetic ingredients market and what has been the acquisition trend among these companies over the past few years?
  • What are the factors that are expected to drive acquisitions in the future?

Table of Contents

1. Executive Summary
  • Key Findings

2. Personal Care and Cosmetic Ingredients Industry Overview
  • Introduction
  • Research Scope
  • Key Questions this Study will Answer

3. Notable Transactions
4. Rationale for M&A
  • Rationale for M&As in the Personal Care and Cosmetic Ingredients Industry

5. Drivers and Restraints
  • Key M&A Drivers
  • Drivers Explained
  • Key M&A Restraints
  • Restraints Explained

6. Growth Opportunities and Companies to Action
  • Transformation in the Personal Care and Cosmetic Ingredients Ecosystem
  • Growth Opportunity 1-Focus on Diverse Functional and Multifunctional Ingredients
  • Growth Opportunity 2-Growing End-user Awareness
  • Growth Opportunity 3-Gain Access to Formulation Stabilizers
  • Growth Opportunity 4-Penetrate New Geographical Markets
  • Growth Opportunity 5-Develop Cost Synergies
  • Strategic Imperatives for Personal Care and Cosmetic Ingredients Providers

7. Notable Transactions-M&A Case Study 1: Evonik
  • Evonik Acquires Air Products Performance Materials Business
  • Evonik Acquires Dr. Straetmans and J M Huber’s Silica
  • Evonik Acquires J M Huber’s Silica Business
  • Evonik Acquires Dr. Straetmans

8. Notable Transactions-M&A Case Study 2: Clariant
  • Clariant Acquires CRM International SAS
  • Clariant Acquires Vivimed Product Range and Partners with BioSpectrum
  • Clariant Acquires Vivimed Product Range
  • Clariant Partners with BioSpectrum

9. Notable Transactions-M&A Case Study 3: Seppic
  • Seppic Acquires Biotech Marine and Serdex (Bayer Division)

10. Notable Transactions-M&A Case Study 4: Givaudan
  • Givaudan Acquires Induchem and Soliance

11. Notable Transactions-M&A Case Study 5: International Flavors & Fragrances Inc. (IFF)
  • IFF Acquires Lucas Meyer Cosmetics and Aromor

12. Notable Transactions-M&A Case Study 6: Croda
  • Croda Acquires Nautilus BioSciences

13. Notable Transactions-M&A Case Study 7: Sun Chemical
  • Sun Chemical Acquires Kingfisher Colours

14. Last Word
  • Legal Disclaimer

15. Appendix
  • List of Exhibits

Companies Mentioned

A selection of companies mentioned in this report includes:

  • Air Products
  • Aromor
  • BioSpectrum
  • Biotech Marine
  • CRM International
  • Centre Ingredient Technology
  • Clariant
  • Croda
  • Evonik
  • Givaudan
  • Greentech of Mapric
  • IFF
  • Induchem
  • Kingfisher Colours
  • Lucas Myer
  • Nautilus BioSciences
  • Seppic
  • Serdex
  • Soliance
  • Sun Chemical
  • Takasago
  • Vivimed