The plastics industry is experiencing more than a resurgence in market growth and mainstream media coverage; it’s receiving increased attention from investors as well. Every day the idea of a “plastics renaissance” is evolving from a cliché to reality.
What should business owners and plastics industry professionals know before making strategic growth decisions? The latest edition of the Plastics News Fireside Chat, fueled by M. Holland, focused on the challenges and nuances associated with a growing mergers and acquisitions (M&A) market.
Dwight Morgan, vice president of corporate development at M. Holland, sat down with Jeff Mengel, partner at Plante Moran, to delve deeper into the financial world’s impact on the plastics industry.
This year has been pivotal for plastics industry M&A activity as companies have completed more than 160 transactions in just the first half of 2017. Both Mengel and Morgan expect to see more of the same growth throughout the rest of the year thanks to an abundance of capital in financial markets, low interest rates, and pressure on both private equity firms and public companies to deliver growth in a tepid economy
Mengel and Morgan have also both witnessed an increase in foreign buyers interested in U.S. companies and vice versa. But they also cautioned about the complexities of international expansion, noting that operating globally presents currency, political and cultural risks. Mengel advises that companies have a sound strategic rationale before making international investments.
Mergers and acquisitions are riskier avenues for growth than organic efforts, Mengel and Morgan agreed, but the risks can be mitigated through careful due diligence and well-planned integrations.
For more advice from Morgan and Mengel, see their engaging conversation and insider-look into the complex world of finance and M&A. You can view the full recorded episode here (choose “Fireside Chat #3” to download the archived recording).
Find more information about the Fireside Chat series and dates for future episodes here.
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