Primed and Ready

By Christine Esposito , Associate Editor | September 4, 2013

Clariant’s Care Chemicals Unit has solidified its place as a go-to supplier

Clariant is on a roll. In July, the firm announced that its Care Chemicals Business reported a solid second quarter performance, with a sales gain of 8% year on year. The announcement came just weeks after the Swiss specialty chemical company received the green light on a key joint venture in the growing Asian region—the latest step in the firm’s efforts to sharpen its position as a leading supplier in the global household and personal care category.

The gain (6% in Swiss francs) came on the back of strong volumes, the company said. Latin America achieved double-digit growth and Europe and North America tallied single-digit growth. Sales in the Middle East & Africa were below the previous year level, according to the company, and Asia/Pacific remained unchanged.

“Our strategy is paying off, the recipe works. The innovation pipeline is well filled,” chief executive Hariolf Kottmann said at the company’s Capital Markets Day in New York City in July. 

Clariant has a four-pronged approach to creating value for its stakeholders and becoming a global leader in specialty chemicals: increase profitability, intensify growth, foster innovation and R&D and reposition its portfolio.

That repositioning has included the acquisition of Süd-Chemie in 2011 and, more recently, divestment of its textile chemical, paper specialty and emulsion businesses to SK Capital. This year, Clariant plans to further slim down its portfolio by shedding its leather business and selling a trio of commodity products.

The moves are part of a strategy to provide Clariant’s Care Chemicals unit with a clear focus on highly attractive, high margin, and low cyclicality segments backed by production and R&D capacity that’s ready to serve the global market. All told, the firm has 14 production sites and five R&D sites scattered across the globe from Santa Clara, CA to Shizuoka, Japan. And at the end of the October, the company plans to inaugurate the Clariant Innovation Center in Frankfurt.

Clariant’s new amines joint venture, which will be the global platform for production and sales of fatty amines and selected amines derivatives, is slated to begin operations in the third quarter 2013. The JV with Wilmar, along with other recent acquisitions and partnerships, will serve as drivers for future growth, according to company executives.

The firm is also leveraging technologies that have come from its acquisition of CRM International, a manufacturer of natural cosmetic ingredients such as emollients, actives, butters and natural alternatives to silicones. For example, Clariant now offers the Plantasens product range—a collection that includes plant-based actives, unique emulsifiers and a broad selection of emollients ranging from vegetable oils and natural butters to alternatives to silicones, petrolatum and lanolin. 

Green Means Go
Speaking in New York, Michael Willome, who is global head of business unit industrial and consumer specialties, pointed to key drivers in the household and personal care space, such as efforts by key customers to switch from oil-based to green chemistry.  He said that firms like P&G and Unilever are seeking “renewable raw materials and want to change their portfolios—and Clariant is very well positioned for this.”

Underlining the firm’s commitment to green, Clariant recently signed the UN Global Compact.

Key new technologies in Clariant’s personal care arsenal include Aristoflex Velvet polymer, which is billed as an advanced new ingredient for skin care products that takes “moisturization and cleansing beyond pure functionality to create a luxurious and long-lasting sensory experience.”

The ethylene oxide (EO)-free and preservative-free ingredient—which was a finalist in the Best New Ingredients category at In-Cosmetics—adds a soft and smooth feel to skin care formulations during application. Its innovative composition does not immediately break on skin when applied, but instead gently melts to leave skin feeling evenly soft and moisturized, according to Clariant.

Additional green chemistries are being explored in Clariant’s R&D labs. For example, in the pipeline is a sugar-based surfactant that is expected to be out in mid 2014, according to company officials.

Clariant’s sees itself as a “solution provider” for regional, mid-size companies and an “innovation provider” to global businesses. 
In addition, Clariant is now working directly with global key accounts, noted Willome. The goal is to be on the ground where they are with leading technologies.

Looking ahead, Clariant officials may seek out small bolt-on acquisitions in the $10-50 million range to “improve its technology, not its footprint,” said Willome. “Our R&D and manufacturing global footprint is complete.”
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