A few notes to update you on our activities in private equity and advisory for the chemicals industry. If you have not had a chance to check our updated website, please do so and let me have your comments www.neilaburns.com

• Silicones: Our involvement with SiVance, carved out of Clariant, September ’09, continues to be a great pleasure. The business is doing very well. The carve-out could not have gone more smoothly and we are still hiring to support continued growth in the coming year.
• Other equity activity continues with a focus on specialties in North & South America and Europe. Compared to this time last year, the pipeline is packed very well. Our partnerships with GenNx360 and Linley continue to bear fruit across a fairly wide EV range up to $1Bn +.
• Our advisory practice focuses on surfactants, oleochemicals and related feedstocks. Our partnership with Desmet Ballestra Italy has been particularly active with the recent re-launch of their ethoxylation platform on new technology. We continue to limit other advisory work to a few long-term clients. However, we will expand our reach into Asia and Latin America with additional personnel in the coming year.
• Our support of the ACS, CM&E Group continues to be very fulfilling. In March, Tim Wilding of Oppenheimer gave an outstand review of chemicals M&A. Then, in October, a panel including GE Capital, Lanxess, Jones Day, GenNx360 and Houlihan Lokey sold out the venue with their “Anatomy of a Deal” discussion. If you are in New York City, January 6^th, please join us for lunch with the ACS Chief Economist for some unique, unedited analysis of the industry’s prospects for 2011. Register here.
• In partnership with ICIS, we are organizing and chairing the 1^st World Surfactant Conference in NYC area, May 12 – 13 2011. Preliminary details here. This is a business conference targeted at senior managers in the industry.

As always, please feel free to reach out if you think we can help with anything. Our equity capital program combines a patient outlook with good understanding of the chemical industry. We like to support management teams with a growth agenda and to enable owners realize their ambitions for their businesses.

Our best wishes for a happy and prosperous New Year.

Neil

Observations from China Specialty Chemicals Trip:

Just got back from a trip to China where the focus was on two of my favorite markets, surfactants and silicones. Many meetings, a couple of conferences, an exhibition and topped off with a speaking engagement, before hopping on the (direct) Shanghai to Newark flight home. The silicones aspect, undertaken primarily on behalf of Sivance LLC, on whose board I sit,  was an eye-opener. Suffice to say, that the organizers, CNCIC, a government  body deserve a lot of credit for the quality of the event. I will be talking more about silicones in the coming weeks.

Surfactants in China is a hot market. And by hot, I mean, booming and somewhat overbuilt. In common with many markets there, we see tremendous overcapacity and a very large number of local producers, often sub-scale, competing with larger multinationals who are setting up shop primarily to take part in the growing consumer market for surfactant containing products like laundry detergent, shampoo and cosmetics. I spoke at the 10^th Asia Surfactant Conference in Shanghai and moderated one of the afternoon sessions. One of my speakers from Huntsman painted a picture of a highly oversupplied market with 14 ethylene oxide producers, pushing product into MEG and surfactant applications. This view was reinforced by an article in the September 6^th edition of the China Chemical Reporter, which noted that China alcohol ethoxylation capacity is currently running at about 50% utilization. With the upcoming 60KMT/yr nonionic surfactant project in Nanjing by BASF-YPC, there is sure to be some serious rationalization and consolidation in this market.

My own contribution to the conference focused on what could be the third major leg to the stool of surfactant feedstocks, that is bio-mass. A copy of the paper can be downloaded from my site, here.
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