Valuations of Chemical Companies and Distributors: Comparable Metrics and Precedent Transactions

2018 ◽  
Keyword(s):  
Supply Chain ◽  
Mergers And Acquisitions ◽  
Interest Rates ◽  
Private Equity ◽  
Public Funds ◽  
The Past ◽  
Company Valuation ◽  
Chemical Companies ◽  
Chemical Distribution

Over the past 20 years, private equity firms and strategic buyers have aggressively invested in chemical companies, including the logistics supply chain of chemical distribution. The availability of public funds at meager interest rates is the main reason that mergers and acquisitions are happening at such a high pace. Company valuation then becomes very important to determine the value of the deals. Public chemical companies’ comparable metrics, together with profits from precedent transactions, can provide a handy guide for both strategic buyers and private equity firms when considering an acquisition.

Indian API industry has the tide turned?

2019 ◽  
Vol 16 (1) ◽  
pp. 27-38
Author(s):  
ML Shreyan
Keyword(s):  
Financial Markets ◽  
Private Equity ◽  
Business Models ◽  
Industry Structure ◽  
Key Factors ◽  
The Past ◽  
Regulated Markets ◽  
Revenue Streams ◽  
Chemical Companies ◽  
Backward Integration

Over the past decade or so, API industry has lost out to Generics in attracting investments due to prevailing industry structure which favoured greater returns from Generics – faster growth and better margins among others. In the past three to five years, with Generics losing sheen with normalised margins and returns, API businesses are getting back onto investor radar. With inherent chemistry and engineering complexity, API manufacturing has the potential to create businesses protected by better moats. Another pain point of the API industry was Chinese exuberance in offering APIs at irrationally low prices, which eventually destroyed value for the entire industry as a whole. A slew of recent measures and events has established parity among all players – Chinese, Indian and European, with the anticipation that it should better industry wide performance. Indian API companies are well positioned to leverage the situation and improve their standing in the API industry. Financial markets have begun to recognise some of these players like Divis Laboratories, trading at market capitalisations comparable to generic companies with 10 times higher revenue. Besides large players like Divis, a bunch of upcoming Indian API suppliers led by MSN Labs have focused on developing a large number of niche, low competition APIs for supplying to the regulated markets. Such portfolio lends towards above industry average realisations and wider customer penetration. Besides public listing, API companies have been sought after targets for adjacent players in CDMO space, chemical companies, chemical distributors for forward/backward integration and creating additional revenue streams. A bunch of private equity players have already setup or in the process of setting up platforms to consolidation API companies, as we speak. For an investor, it is the key to understand the various business models and the key factors driving the choice of targets to ensure the strategy is well designed to succeed.

scholarly journals Asia’s Chemical Distribution Market: The final Frontier for Mergers and Acquisitions!

2021 ◽  
Vol 9 (9) ◽  
pp. 148-170
Author(s):  
Tay Kin Bee
Keyword(s):  
Mergers And Acquisitions ◽  
Chemical Industry ◽  
Private Equity ◽  
High Growth ◽  
Background Information ◽  
Market Size ◽  
Consolidation Process ◽  
Lack Of Information ◽  
Major Chemical ◽  
Chemical Distribution

The chemical distribution business had undergone huge transformational changes globally, through mergers and acquisitions, by both strategic buyers and private equity firms. The industry consolidation process in Europe and North America which started many years ago is now being shifted to Asia. There is very little research being done on Asia’s chemical distribution market size and the major chemical distributors. Asia’s chemical industry enjoyed tremendously high growth in the past years, and coupled with the highly fragmented chemical marketplace, it offers huge scope for consolidation. The lack of information and clarity in Asia’s chemical distribution sector has somewhat impeded the pace of the consolidation process. A clearer knowledge of the chemical distribution market size, and the key players in the market, itself would help potential investors enormously in their decision making to expedite the mergers and acquisitions process. The research findings can serve as a compass for potential investors to navigate through Asia when searching out for potential targets and would offer investors a much-needed informational tool to know where to look to invest in. Literature review on existing publications, chemical industry trade publications, and chemical distribution associations will provide the background information for this research.

Remaking Retirement

2020 ◽  
Keyword(s):  
Interest Rates ◽  
Older Workers ◽  
Older Persons ◽  
The United States ◽  
Older Population ◽  
The Past ◽  
Cost Of Education ◽  
The World ◽  
Low Interest Rates ◽  
Key Aspects

Around the world, people nearing and entering retirement are holding ever-greater levels of debt than in the past. This is not a benign situation, as many pre-retirees and retirees are stressed about their indebtedness. Moreover, this growth in debt among the older population may render retirees vulnerable to financial shocks, medical care bills, and changes in interest rates. Contributors to this volume explore key aspects of the rise in debt across older cohorts, drill down into the types of debt and reasons for debt incurred by the older population, and review policies to remedy some of the financial problems facing older persons, in the United States and elsewhere. The authors explore which groups are most affected by debt, and they also identify the factors causing this important increase in leverage at older ages. It is clear that the economic and market environments are influential when it comes to saving and debt. Access to easy borrowing, low interest rates, and the rising cost of education have had important impacts on how much people borrow, and how much debt they carry at older ages. In this environment, the capacity to manage debt is ever more important as older workers lack the opportunity to recover for mistakes.

The problems facing agricultural sector in Zanzibar and the prospects of Waqf-Muzar’ah-supply chain model

Humanomics ◽  
2017 ◽  
Vol 33 (2) ◽  
pp. 189-210 ◽  
Author(s):  
Issa Salim Moh’d ◽  
Mustafa Omar Mohammed ◽  
Buerhan Saiti
Keyword(s):  
Supply Chain ◽  
Interest Rates ◽  
Financial Models ◽  
Agricultural Sector ◽  
Chain Model ◽  
Content Type ◽  
High Interest ◽  
Supply Chain Model ◽  
The Government ◽  
Clove Industry

Purpose This paper aims to identify the appropriate model to address the financial challenges in agricultural sector in Zanzibar. Since the middle of 1960, clove production has continually and significantly decreased because of some problems and challenges that include financial ones. The financial intermediaries such as banks, cooperatives and micro-enterprises provide micro-financing to the farmers with high interest rates along with collateral requirements. The numerous programmes, measures and policies adopted by the relevant parties to find out the solutions to the dwindling clove production have failed. Design/methodology/approach The authors will review and examine several existing financial models, identify the issues and challenges of the current financial models and propose an appropriate Islamic financing model. Findings The numerous programmes, measures and policies adopted by the relevant parties to find out the solutions to the dwindling clove production have failed. This study, therefore, proposed a Waqf-Muzara’ah-supply chain model to address the financial challenge. Partnership arrangement is also suggested in the model to mitigate the issues of high interest rates and collateral that constrains the financial ability of the farmers and their agricultural output. Originality/value The contribution of the agricultural sector to the economic development of Zanzibar Islands is considerable. As one of the important agricultural sectors, the clove industry was the economic backbone of the government of Zanzibar. This study is believed to be a pioneering work; hence, it is the first study that investigates empirically the challenges facing the clove industry in Zanzibar.

The Trouble with Lenders: Subtleties in the Debt Financing of Commercial Real Estate

2016 ◽  
pp. 1-14
Author(s):  
Craig Furfine
Keyword(s):  
Real Estate ◽  
Interest Rates ◽  
Private Equity ◽  
Commercial Real Estate ◽  
Strategic Decision ◽  
Holistic View ◽  
Operating Income ◽  
Final Property ◽  
Retail Shopping ◽  
Management Issues

With interest rates near all-time lows in late 2015, Stanley Cirano knew it was an opportune time to consider the financing on his portfolio of commercial real estate. Cirano Properties was the general partner on three separate private equity investments of retail shopping centers in suburban Chicago. The first, Brookline Road Shopping Center, had been acquired in 2006 and had been managed through the financial crisis and real estate downturn. The property was performing well and Cirano wondered whether it made sense to refinance or sell. The second property, Columbus Festival Plaza, had been acquired in a 2010 bankruptcy auction. Although the property had needed a good amount of capital improvements, Cirano was proud of the growth in net operating income he had been able to generate. The final property, Deerwood Acres, had been developed by Cirano himself after acquiring the property in 2013 from the previous owner, who had been operating a go-cart track and drive-in theater on the land. Cirano expected great things from the property, though his lease-up had been slower than anticipated. Although the three properties had different levels of performance and presented different management issues, they all shared the fact that they were all significantly financed, in part, with debt. As the properties were acquired at different times, Cirano had simply selected what seemed like reasonable financing at the time. With his concern that interest rates would soon be rising, Cirano thought it made sense to take a holistic view of his portfolio, consider what debt options were available to him, and make a sound strategic decision on the financing of all his assets at the same time.

Wills Lifestyle in India

2017 ◽  
pp. 1-16
Author(s):  
Sunil Chopra
Keyword(s):  
Supply Chain ◽  
Raw Materials ◽  
Supply And Demand ◽  
Third Parties ◽  
The Past ◽  
Relative Value ◽  
High Level

In 2003, ITC responded to the high level of obsolete inventory by shifting risk from finished products to manufacturing and raw materials. This required that their supply chain be much more flexible and responsive than it was in the past. By 2006, changes in the supply chain that included moving manufacturing in-house improved flexibility and responsiveness. Obsolete inventory was significantly reduced and the company was much better at matching supply and demand. Cost, however, continued to be higher than that at third parties. The company had to decide on the appropriate tradeoff between cost and responsiveness when structuring its supply chain.The case illustrates how Wills has changed its supply chain to become more flexible and responsive. This change, however, has come at a cost. The case requires the students to analyze the tradeoff between cost and responsiveness/flexibility to decide on an appropriate level of flexibility/responsiveness. The case also requires the student to understand the relative value of increased flexibility versus increased responsiveness.

scholarly journals How To Invest Your IRAs In Profitable Real Estate IRAs

2011 ◽  
Vol 2 (11) ◽  
Author(s):  
Raj Kiani ◽  
M.A. Sangeladji
Keyword(s):  
Real Estate ◽  
Interest Rates ◽  
Retirement Savings ◽  
Sharp Decline ◽  
The Public ◽  
Individual Retirement Accounts ◽  
The Past ◽  
Retirement Accounts ◽  
Roth Ira ◽  
Investment Advisers

Since the inception of Individual Retirement Accounts (IRAs) in 1974, the public has been advised strongly by bankers, accountants (CPAs), and investment advisors that the best strategy for IRA holdings is investment in stocks or bonds.  Unfortunately, with the sharp decline in the market value of stocks and the bottoming out of interest rates in the past years, most IRA funds have performed very poorly and investors have witnessed how drastically their retirement savings lost their accumulated value.  During these years, apparently, not many investment advisers have bothered to consider other alternative ways for investing accumulated IRAs and pension funds.  There is, in fact, another viable investment alternative that offers both safety and a considerable growth rate.  That is real estate IRAs.  The purpose of this paper is to explain (a) why the traditional and Roth IRA should be invested in real estate, b) the steps involved in establishing a sound real estate IRA, (c) the restrictions and the dos and don’ts of investing in a real estate IRA, and (d) the tax and penalty consequences of incorrect investment in a real estate IRA.

scholarly journals Optimal Loan Pricing for Agricultural Supply Chains from a Green Credit Perspective

2021 ◽  
Vol 13 (22) ◽  
pp. 12365
Author(s):  
Liurui Deng ◽  
Wentang Xu ◽  
Juan Luo
Keyword(s):  
Sustainable Development ◽  
Supply Chain ◽  
Supply Chains ◽  
Interest Rates ◽  
Optimization Problems ◽  
Bank Loans ◽  
Loan Pricing ◽  
Pricing Rules ◽  
The Incentive Mechanism ◽  
Agricultural Supply

In recent years, many countries have proposed various sustainable development strategies around environmental issues. The implementation of green supply chain management is an effective sustainable development approach that combines “environmental awareness” and “economic development.” Therefore, introducing the concept of “green” effectively is the main direction for the sustainable development of agriculture in the future. The impacts of green credit policies on agricultural supply chains have rarely been discussed before. Therefore, we focus on the incentive mechanism of green credit policies in the agricultural supply chain. We use the Stackelberg Leadership Model to construct a pricing model which adds the interest subsidy and required reserve ratio (RRR) cuts, and determines the pricing rules of bank loans and production decisions of the farmer in the agricultural supply chain under the incentive policy of green credit by quantifying the optimization problems of the bank and the farmer. The result shows that optimal decisions exist for both farmer and bank in the supply chain game framework. The implementation of the green credit policies contributes to both of their profits. Additionally, the green credit policies give the bank room to reduce interest rates so that the overall utility level of the supply chain could be improved.

Sign in / Sign up

Export Citation Format

Share Document