"With the AkzoNobel deal, Kemira will change overnight from a 2,1 billion euro company to a 2,3 billion euro company. We will continue to push for 2,7 billion by 2017," says Kemira's CEO Jari Rosendahl.
Kemira, considered a chronic underperformer, is now standing firmly on its feet and focusing on improving profitability and growth. Opposite him sits a different man than he was last May when he began his term as CEO. The same calmness and determination could be heard in Rosendal's speech then.
Kemira continues restructuring under the previous CEO Wolfgang Büchelen piloting the way, but in moderation. The separation from Chemsolution last spring put an end to the formic acid business. According to Rosendal, the time for major reorganizations is over.
"The portfolio has now been sufficiently cleaned up. Eyes and ears are open. If something small to acquire comes up, it will interest me," says Rosendal.
Everything that has been done now supports the three business areas Paper, Oil & Mining and Municipal & Industrial.
"When we are number one or number two in each, we are in a good position. There is a clear goal and a path to get to the top."
However, the turnover target of 2017 billion euros set for 2,7 will not be achieved through acquisitions, even if the balance sheet allows for it.
"We will reach the goal with synergy benefits, good geographical coverage and increased competitiveness."
Expert and implementer
Rosendal emphasizes many times that Kemira is not a product seller, but rather a solution partner, even though the company was moving strongly towards water treatment in 2007–2012.
"Kemira is a chemical technology company whose strength lies in its expertise. It is true that water is a medium in all its operations."
“We are big in paper and pulp chemicals and are growing strongly in Oil & Mining.”
Kemira's field is water-intensive industries, and it helps customers with, among other things, their water, energy and raw material efficiency. The company utilizes the same technologies in all three segments, which creates much-needed synergy and competitive advantage. The annual product development investment is EUR 30 million.
“Competition is fierce, and the situation is very different in different segments and geographies. The paper segment is the strongest, and we are the undisputed number one there, as the AkzoNobel deal has been completed to the last detail. We are also the only global player in both pulp and paper chemicals,” says Rosendal.
In July 2014, Kemira announced a preliminary agreement to acquire AkzoNobel's global paper chemicals business.
For the next couple of years, Kemira's cash generator will be Municipal & Industrial, or M&I, which manufactures chemicals for raw water and wastewater treatment. Its task is to support investments in the other two segments.
“The most significant project at the moment is the 153 million euro AkzoNobel acquisition, which we hope to complete early this year,” says Rosendal.
The deal doubles Kemira's paper-related business in Asia, where four of the six acquired mills are located. Half of the business is in the packaging and tissue paper segment, which the company wants to grow.
"Overnight, a 2,1 billion house grows into a 2,3 billion euro house, from which we will then strive to reach the goal of 2,7 billion."
“If you just look at the reported numbers, you can question the growth of the paper and pulp side. In reality, the growth has been between four and six percent per year for the last couple of years. We intend to maintain this pace.”
Geographically, operations have been heavily focused on Europe and North America. Developing countries still account for a small share of production. According to Rosendal, good growth is visible in Asia, China and also South America.
Text: Anna Holm
Photo: Kemira
