Industrials and Chemicals Sector Comment – January 2015

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The Personal Protective Equipment (PPE) market has seen increased M&A activity in recent months, especially from private equity investors. Of notable interest is the €600m acquisition of Survitec Group Ltd by the Canadian private equity firm Onex. Survitec, which operates seven facilities around the world, is a manufacturer of survival equipment such as life jackets and anti-gravity suits for the marine, aerospace and defence industries. In 2014, Survitec had revenues of €330m. The transaction, subject to regulatory approval, will provide an exit for Warburg Pincus.

August Equity has recently acquired three businesses and merged them to form Safety and Survival Systems International Ltd (3Si). The businesses – Ocean Safety Ltd, Revere Survival Inc and Typhoon International Ltd – are all involved in the marine safety products sector, selling products such as life rafts, life jackets, rescue boats and harnesses to the commercial, leisure and military markets in the UK and North America.

Bunzl plc has just announced the acquisition of Blake H Brown, the US manufacturer of protective gloves which trades as Tillman. This acquisition follows the purchase of Allshoes Benelux BV in the Netherlands in June 2014, a distributor of safety and work shoes, and the acquisition of Tecno Boga SA, a leading supplier of own-label protective footwear in Chile.

We are seeing active interest in PPE companies from both corporate acquirers and financial investors alike. Given increasing government regulations surrounding workplace safety and augmented awareness of safety issues in developing countries, the sector is growing and as such is attractive to investors. The highly fragmented nature of the sector presents significant opportunities for consolidation.

Clearwater International recently advised the management of Total Access, a height safety equipment distributor and training & services provider, on its sale to Arco Ltd.