At the 2023 FlexPO+ (now incorporated into the ADI Forum), Uday Turaga, CEO, ADI Analytics, provided critical insights on the current state of private equity. This included investments in plastics and polymers. He explained that the private equity landscape in chemicals experienced a downturn in 2022 after a surge in 2021. This was primarily due to rising debt costs that reduced the buyer pool. Consequently, this lowered valuations, especially for financial buyers. Despite this, a substantial amount of capital, close to $2.5 trillion in US private equity assets under management, remained available for investment. The materials and resources sector, including plastics, saw a significant decline in M&A activity in the latter half of 2022.
A notable trend was the increasing acquisition of specialty chemical assets in the US and Europe by Asian chemical majors. This was driven by a desire to access expertise and talent pools. Additionally, it aimed to build a hedge against commodity-focused chemical exposure. The bio-plastics segment was also seeing considerable interest and activity. There was ongoing work to understand its dynamics and assist producers with plant divestitures.
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ADI is a prestigious, boutique consulting firm specializing in oil and gas, energy transition, and chemicals since 2009. We bring deep expertise in a broad range of markets where we support Fortune 500, mid-sized and early-stage companies, and investors with consulting services, research reports, and data and analytics, with the goal of delivering actionable outcomes to help our clients achieve tangible results.
We also host the ADI Forum that brings c-suite executives together for meaningful dialogue and strategic insights across the oil & gas, energy transition, and chemicals value chains. Learn more about the ADI Forum.
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