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CASE STUDY Consolidating Global Chemicals Logistics Service Providers OEP’s investment professionals developed the thesis that chemical manufacturers are consolidating their production facilities into fewer, larger plants to reduce costs. At the same time, these companies are increasingly selling to a more geographically diverse customer base. OEP believes that the reduction in plants and geographic expansion of the customer base will lead to a general growth in demand for chemical transportation and logistics services. OEP noted that the chemical transportation and logistics providers market was fragmented and came to believe specific segments of the chemical supply chain could be consolidated to create larger product/service companies providing truly global service to their customers. Consequently, OEP researched and called on a number of chemical container, terminal, pipelines, shipping and processing/handling businesses to explore its thesis. OEP specifically identified LBC S.A. (“LBC”), a chemical terminal company with strategic facilities in 12 major ports including Houston and Rotterdam, and Mauser-Werke GmbH & Co. KG (“Mauser”), a company with leading container technology, as businesses that could be used as platforms for consolidation. OEP purchased Mauser in April 2003 and LBC in May 2004, and sold both investments in June 2007, realizing gross IRRs of 43% and 78%, respectively.  |
 CASE STUDY Global Chemical Industry Return to Investment Approach |
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