INTERVIEW IMCD

Poised to expand on the global stage

Netherlands-based IMCD Group is rebranding, and is looking to buy in Europe, Africa and Asia
ELAINE BURRIDGE/LONDON

ChemICAlSdIStrIButorImCd Groupisrebranding.Themoveisthelatest stepinthegroupsstrategytopursuefurther growthinthedistributionofspecialty chemicalsandfood,pharmaceuticalsand cosmeticingredients. ImCdGroupCeoPietvanderSlikkesays therebrandingisanaturalprogressionafter aseriesofacquisitionsoverthepast10years. Wehaveevolvedintoaleadingintegrated chemicalsdistributor,butwehavenotshown thatinourname,hesays.Thenextstepis tooperateworldwideasImCdandtobrand ourselvesmuch[morestrongly]. headquarteredinrotterdam,the Netherlands,ImCdhas28companiesin itsnetwork,scatteredthroughouteurope, Africa,AustraliaandNewZealand.Asof 3April,allofthesewilloperateunderthe ImCdcompanyname. VanderSlikkejoinedImCdasits Ceoin1995,whenitbelongedtodutch parent,engineeringandtradingcompany Internatio-mueller,whichheldadisparate groupofbusinessesinvolvedinother industriesaswellaschemicals,suchas printmachiningandtimber.VanderSlikke decidedtofocusonthechemicalsindustry andsetouttobuildadistributionbusiness ineuropethatcouldofferservicestothe sectoronapan-europeanbasis. Althoughthisstrategyappears commonplacenow,andothermajor distributorshavebeenpursuingthesame path,theconceptwasunusual10yearsago. Atthattime,wefeltchemicalswastheonly realbusinesswecould[really]internationalise andexploitoursynergies,saysvanderSlikke. AsImCdsbusinesswasregional,withlocal salesandlogisticsorganisations,Vander Slikkemadeaseriesofacquisitions.Bythe endofthe1990s,hehadbuiltuphisdesired pan-europeaninfrastructure.

Thecompanythenestablished europeanmarketinggroupsindifferent sectorssoitcouldfocusonandprovide technicalexpertiseincoatings,plastics, pharmaceuticals,cosmetics,foodandresins. Becauseoftheirpan-europeanfocus,van derSlikkesaysthesegroups,whichare madeupofexpertsfromImCdsnetwork companies,canidentifyanygapsinthe portfolioorgeographiccoverage.

M&A continues

ImCdsbuyingspreedoesnotlooktobe ending,either.Inthepastyearalone,ithas purchasedsixcompanies.ThesearePebepol intheNetherlands,optimaChemicals andBrianJonesintheuK,SolvadisSouth Africa,whichacquiredthefoodand specialtydivisionsoft&CChemicalsin February2007,andSoppC&KVertrieb. VanderSlikkeintendstomakefurther purchasesintargetareasashestrivestoreach hisgoalofgrowingfasterthanthemarket andachievingannualdouble-digitgrowth. hisstrategyistwofold:togroworganicallyby addingproductlinestotheportfolioandto makefurtherbolt-onacquisitions. decliningtobespecificoncountriesor sectors,hesaysImCdwouldprefertoinvest inthelargereuropeaneconomies.Weare alwayslookingatopportunities.Wewant tobuildourpresencefurtherinemerging marketsinAfricaandarelookingfor opportunitiesinAsia. InAsia,heislookingatacquisitionsfirst andhopestoseeapositiveresultinthe nextoneortwoyears.ImCdhasofficesin Shanghai,China,andinmumbai,India, whicharemainlyusedforsourcing.We alsowanttodistributetherelikewedoin europe.Wefeelthatourbusinessmodel hasapplicationsthatcouldbeusedina similarwayinAsia,saysvanderSlikke. Thecompanyhassalesofficesthroughout AustraliaandinAuckland,NewZealand.

Van der Slikke: on the acquisition trail

ButvanderSlikkessightshaveturned awayfromtheuSwhere,afewyearsago, heexpectedtopursueasimilarstrategy toeurope.Wefeelwecannotexploitthe necessarysynergieswithoureuropean business,heexplains.entrybarriersare highifyouwanttobecomeanationalplayer, giventheconsolidationthathastakenplace. Indeed,thebidforChemCeNtrAlby univaruSAlastmonthisfurtherproofofa trendthatdistributorsexpectwillcontinue. moneyisnotaproblemforImCd.Vander Slikkesaysthecompanycanhaveasmuch asitwants,whichisoneadvantageofbeing ownedbyprivateequityfirmABNAmro. Thereisalwaysmoneyavailableforgood opportunitiesandwehavealwaysbeenfreeto putagoodproposalonthetable,hesays. ABNAmroboughtImCdinJuly2005 fromdutchprivateequityhouseAlpInvest Partners,whichhadpaid195m($257m) tobuythedistributorfromInternatiomuellerinApril2001.

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Features: will.beacham@icis.com

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iMcD in figures
Sales (2006): 800m ($1,056m) Employees: 800 worldwide Offices in: Australia, Austria, Belgium, China, Czech Republic, Denmark, Finland, France, Germany, Hungary, Ireland, Italy, Lithuania, Morocco, The Netherlands, New Zealand, Norway, Poland, Portugal, Russia, Serbia, Slovakia, South Africa, Spain, Sweden, Switzerland, Turkey, the UK Key clients: BASF, INEOS, Eastman Chemical, Wacker Chemie, FMC, Quest and DSM

groupproductmanagerswithinternational responsibilitiescanseewhattheircolleagues aredoing.Theyareabletoseewhatactivities wehaveineachsector,andcanaccessvisit reportsandsamplinginformationaswellas afullproductandcustomerdatabase,says vanderSlikke. headds:Ithasbroughtusanenormous cohesionandmeansthateveryoneinthe grouphastoworkandthinkinasimilar way.Thisisvitalifyouwanttohaveapaneuropeanapproach. AsvanderSlikkegetsreadytosteer ImCdthroughthenextphaseofits development,whatdoesheseeasthemajor challengesforthedistributionsector? Formanyindependentlocal distributors,thechallengewillbehowto makethemselvesattractiveagainstgroups thatcoverabroadgeographicarea,hesays. Inaworldofdecliningmarginsand pressuretocutcosts,distributorsmust provethevalueoftheirservicestothe supplychain.twentyyearsago,margins werelargeenoughnottoworry.Now distributorshavetobeprofessionaland accountable. ImCdschallengewillbetokeepgrowing. Wewanttocompeteinsizebutalsoin bringingnewconceptstothemarket.We wanttobetheleaderininnovationand valuecreation,heemphasises. Frombeingrelativelyunknown10years ago,thegroupisnowoneofthemainplayers inthespecialtychemicalsdistribution market.ThisistestamenttovanderSlikkes vision.hesays:Ifyouarededicated,havea goodstrategyandareconsistentlyfocused, youcanachievethat.
For more information, visit
www.imcdgroup.com

PAn-euroPeAn APProAch

The next step is to operate worldwide as IMCD and brand ourselves much [more strongly]
Piet van der Slikke, CEO, IMCD Group

VanderSlikkestressesthatImCdssales staffarequalifiedtechnologistswithdeep technicalknowledgeoftheirmarketsector. Wehavespecialisationsforeverymarket segment,hesays.

criticAl MAss

ABNAmroownsthemajoritystake inImCdwiththegroupsmanagement retainingasignificantshare.Thegroupturns overabout800mannuallyandhas800 employeesworldwide. VanderSlikkesaysthatImCdisnotjust adistributorofotherpeoplesproducts.We aretheextendedsalesarmofthesupplier.A producerrestrictshimselftokeycustomers. maybe20%ofhiscustomersprovide80%of hisbusiness,sowelookaftertherest.ImCds functionswouldincludetechnicaladvice, applicationwork,formulations,andtesting.

headdsthatImCdscriticalmasshas givenittheabilitytofundtechnicalservice laboratories.Thecompanyhascentres nearParis,France,andinmalmo,Sweden, whereitcarriesouttechnicalservicesfor thecoatingandconstructionmarkets.There arealsolaboratoriesinmilan,Italy,andin mechelen,Belgium,toservethecosmetics andfoodindustries,respectively. VanderSlikkeisalsoproudofthe groupsItinfrastructure,whichhesaysis thecorporategluebehindImCdsnetwork. Theuniquesystemwasbuiltintheearly partofthisdecadeandgivesemployees accesstothegroupsactivitiesthroughout europe.Anywhereineurope,senior

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