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Beating powder blues: analysis of European powder coatings market
F O C U S thrive in 2008. Between 2001 and middle of 2008, retail sales of Russian paints nearly increased threefold to $610 M, according to market analyst Euromonitor. Major Russian brand Russkie Kraski (Russian Coatings) reported that the market growth for the industry in 2008 was predicted at 9-10%. Though concerns about Russia’s economy are increasing, growth opportunities in the paint market are still considered to be substantial. This is essentially because the country’s local and industrial paint consumption is only at about 1 M tonnes/y compared to Germany’s 2 M tonnes/y. Analysts at Russkie Kraski estimate that the local paints market will grow twofold during the next 10-12 years. Even Russkie Kraski posted strong production figures for 1H 2008/2009. In 2008/2009, the firm’s production of powder paints rose by 40% to 621 tonnes and water-dispersible materials by 72% to 2355 tonnes. Russkie Kraski’s total sales volume also climbed by 10% to Rouble 1690.4 M ($62.5 M) compared with 2007/2008 levels. In the decorative paint markets, the medium segment, which expanded by 21% in 2008, will continue to record the largest growth. However, the premium sector will be the most attractive segment for investors, according to an executive from Tikkurila Deco East. US-based DuPont and BASF are some of the foreign investors showing confidence in the Russian paint sector. DuPont inaugurated a $3 M coatings facility in Yaroslavl in Sep 2008, while BASF opened a 60,000 tonne/y in Pavlovsij Posad in Dec 2008. PPCJ, Polymers, Paint, Colour Journal, Feb 2009, 199 (4533), 16-17
2008: an Olympic year: mergers and acquisitions in the coatings industry The coatings industry saw a series of M&A deals in 2008, the MAY 2009
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POWDER
majority of which took place in the USA. Leading the trend is AkzoNobel, which began its series of M&A activities with the takeover of ICI in Jan 2008. The company soon purchased its European coil coating jv with Nippon Paint, the European fatty amines division of Kao and three US businesses, including Lord Corp and Soliant’s resilient floor coatings segment Enviroline. Following AkzoNobel in terms of M&A deals was PPG. PPG acquired China-based Bonny and several US businesses such as Vanex, NanoProducts and BASF’s coil and extrusion coatings segment in North America. In Eastern Europe, distribution was the central theme among companies that joined the M&A trend. Brentagg acquired Dipol of Ukraine, while Tikkurila purchased its Slovakian Finncolor distributor as part of efforts to broaden its business in Eastern Europe. In 2009, the coatings sector can expect more M&As to take place within the industry itself, with less participation from private equity companies as easily accessible funding dries up. PPCJ, Polymers, Paint, Colour Journal, Feb 2009, 199 (4533), 18,20
C OAT I N G S expansion rates of 12%/y and 10%/y, respectively, over the next five years. Western Europe’s powder coatings market remains the most mature market globally, with future expansion at around 1.4%/y. Italy is still the largest coating market in the region, with output at more than 100,000 tonnes/y and the biggest domestic market in Western Europe at 85,000 tonnes. In terms of resin type, epoxy/ polyester hybrids and pure polyesters accounted for 47% and 41%, respectively, of the powder coatings market of 10 major Western and four major Eastern European economies, according to IRL’s report ‘The Market for Powder Coatings in Europe.’ In general, investments appear likely to be the growth driver of the European powder coatings market. These investments could include new coating methods, spending into more aggressive R&D in new processes, or the construction of new or additional manufacturing units in Eastern Europe. A pie chart shows the distribution of European powder coatings market by resin type in 2007. PPCJ, Polymers, Paint, Colour Journal, Feb 2009, 199 (4533), 36
Beating powder blues: analysis of European powder coatings market
Metal powders to 2012
The European powder coatings market has seen little growth compared with the Asian market, which expanded by roughly 14% in 2006. However, growing output in recent years in Eastern Europe has aided the region in making a comeback. The Eastern European market is set to expand at 10%/y, which is seven times greater than that of Western Europe, due to the recent prevalence of consolidation in the region. Examples of this consolidation are AkzoNobel’s acquisition of Balakom and Protech/Oxyplast Group’s purchase of Ekopowder. Among countries in Eastern Europe, Russia and Turkey are showing great potential with
US metal powder demand through 2012 will improve from a flat 2002 to 2007 performance. Gains will be supported by new uses for many types of metal powders (eg, iron and steel, stainless steel, aluminum, tungsten). An improved outlook for electronics - which use the most expensive metal powders – will boost total value demand. This study analyzes the $3.5 bn US metal powders industry. It presents historical demand data for the years 1997, 2002 and 2007, and forecasts for 2012 and 2017 by type (eg, iron and steel, stainless steel, aluminum, zinc, magnesium, copper, tungsten, nickel, cobalt, molybdenum, 7
2008: an Olympic year: mergers and acquisitions in the coatings industry The coatings industry saw a series of M&A deals in 2008, the MAY 2009
O N
POWDER
majority of which took place in the USA. Leading the trend is AkzoNobel, which began its series of M&A activities with the takeover of ICI in Jan 2008. The company soon purchased its European coil coating jv with Nippon Paint, the European fatty amines division of Kao and three US businesses, including Lord Corp and Soliant’s resilient floor coatings segment Enviroline. Following AkzoNobel in terms of M&A deals was PPG. PPG acquired China-based Bonny and several US businesses such as Vanex, NanoProducts and BASF’s coil and extrusion coatings segment in North America. In Eastern Europe, distribution was the central theme among companies that joined the M&A trend. Brentagg acquired Dipol of Ukraine, while Tikkurila purchased its Slovakian Finncolor distributor as part of efforts to broaden its business in Eastern Europe. In 2009, the coatings sector can expect more M&As to take place within the industry itself, with less participation from private equity companies as easily accessible funding dries up. PPCJ, Polymers, Paint, Colour Journal, Feb 2009, 199 (4533), 18,20
C OAT I N G S expansion rates of 12%/y and 10%/y, respectively, over the next five years. Western Europe’s powder coatings market remains the most mature market globally, with future expansion at around 1.4%/y. Italy is still the largest coating market in the region, with output at more than 100,000 tonnes/y and the biggest domestic market in Western Europe at 85,000 tonnes. In terms of resin type, epoxy/ polyester hybrids and pure polyesters accounted for 47% and 41%, respectively, of the powder coatings market of 10 major Western and four major Eastern European economies, according to IRL’s report ‘The Market for Powder Coatings in Europe.’ In general, investments appear likely to be the growth driver of the European powder coatings market. These investments could include new coating methods, spending into more aggressive R&D in new processes, or the construction of new or additional manufacturing units in Eastern Europe. A pie chart shows the distribution of European powder coatings market by resin type in 2007. PPCJ, Polymers, Paint, Colour Journal, Feb 2009, 199 (4533), 36
Beating powder blues: analysis of European powder coatings market
Metal powders to 2012
The European powder coatings market has seen little growth compared with the Asian market, which expanded by roughly 14% in 2006. However, growing output in recent years in Eastern Europe has aided the region in making a comeback. The Eastern European market is set to expand at 10%/y, which is seven times greater than that of Western Europe, due to the recent prevalence of consolidation in the region. Examples of this consolidation are AkzoNobel’s acquisition of Balakom and Protech/Oxyplast Group’s purchase of Ekopowder. Among countries in Eastern Europe, Russia and Turkey are showing great potential with
US metal powder demand through 2012 will improve from a flat 2002 to 2007 performance. Gains will be supported by new uses for many types of metal powders (eg, iron and steel, stainless steel, aluminum, tungsten). An improved outlook for electronics - which use the most expensive metal powders – will boost total value demand. This study analyzes the $3.5 bn US metal powders industry. It presents historical demand data for the years 1997, 2002 and 2007, and forecasts for 2012 and 2017 by type (eg, iron and steel, stainless steel, aluminum, zinc, magnesium, copper, tungsten, nickel, cobalt, molybdenum, 7