Uptick In Chemical Deals Seen; Carlyle, Apollo Big Players

Financial and private equity investors Icahn Enterprises, Apollo Global Management, First Reserve and SK Capital ranked among the top 10 acquirers among the major 2012 deals in the chemical sector, according to a new survey forecasting an uptick in sector activity.

Overall, some 55% of chemical industry executives expect an increase in merger and acquisition activity in 2013 because of favorable financing conditions, consolidation in Asian, regional expansion and cheap natural gas as a source for energy and raw materials, according to the A.T. Kearney survey.

Private equity firms continue to play a major role in the chemical sector mix, with financial investors contributing “significantly” to deal value, the survey said.

Among the key deals announced in 2012:  Carlyle Group set plans for a major acquisition in the coatings industry by agreeing to buy DuPont’s auto paint unit for $4.9 billion.

Among 2012’s completed deals, Icahn Enterprises LP bought CVR Energy Inc. in a merger valued at $2.8 billion and Apollo Global Management LLC completed a $1.4 billion transaction for Taminco NV of Belgium.

First Reserve Corp. teamed up with SK Capital Partners for the $950 million acquisition of TPC Group Inc.

While global economic jitters and higher valuations caused 2012 mergers in the chemical sector to drop to $49 billion from $151 billion in 2011, industry executives signaled more optimism about deal prospects in the current year.