Arkema Forays into Performance Adhesive Business with the Acquisition of Ashland Units

  • 7-Sep-2021
  • Journalist: Jaideep

Arkema, a global leader in manufacturing and distribution of speciality chemicals, has acquired the USA’s performance additives business giant Ashland LLC, a subsidiary of Ashland Global Holdings Inc. The agreement complying with the sale of Ashland’s adhesives business units to Arkema through an all-cash transaction valuing USD 1.65 billion was signed on August 31, 2021. 

Ashland has been a proud owner of a diverse range of high-performance adhesive product segments that have huge demand in high-value-added sectors. Ashland has relished a stable hold on North America’s performance adhesives market through its 6 production units in that region operating with a workforce of 330 people. Its operations also hold huge potential for growth in Asian and European markets. Ashland’s sale for the fiscal year 2021 is expected to be around USD 360 million with an estimated EBITDA to be USD 95 million.  

Performance adhesives are a group of speciality chemicals that majorly comprise of Polyurethane Epoxy, Acrylic, and Silicone. These materials are lightweight, high-temperature resistant, and exhibit excellent mechanical strength, making them highly useful in the end-use industries like automotive, construction, medical equipment etc. Epoxy adhesive is a popular category of performance adhesives that demonstrate high bond strength, electrical insulation, heat resistance and exceptional mechanical strength that warrant its extensive use in construction, metal binding and reinforcements, carpentry etc. The increasing rate of urbanization is the driving factor for the demand for epoxy adhesives that are expected to see a rise of over 5% in the upcoming years.

With the established market position of Ashland and control of its manufacturing facilities, Arkema has demonstrated an excellent strategic move towards its goal to become a pure speciality chemicals leader by 2024. As per ChemAnalyst, the performance adhesives business has a bright future owing to its constantly increasing demand. The synergic advantages resulting from Ashland’s technological platform and Arkema’s geographical positioning is expected to enable Arkema to expand the performance adhesive portfolio and establish itself as a global leader in this segment.

Related Deals