According to a new report from KPMG, merger and acquisitions activity in the chemical industry will increase due to purchases by Middle Eastern and Asian companies. Due to the economic hardships of the past year, Western chemical firms are divesting assets, particularly bulk-chemical businesses. By purchasing assets, Middle Eastern companies will gain facilities, technology and market access. Purchases by Chinese firms help the country become less dependent on foreign suppliers. Companies in both regions also have cash to make purchases. The number of joint ventures involving Western and Middle Eastern or Chinese companies is also likely to increase. China is forecast to surpass the US by 2015 to become the world’s largest chemical producer. The five largest petrochemical producers in 2015 are forecast to be, in order: Saudi Arabia’s SABIC, Germany’s BASF, the US’s Dow Chemical, China’s National Petroleum Corporation and China’s National Chemical Corporation.

Source: KPMG