Specialty Materials and Chemicals Investment Thesis

The following are reasons why we desire to invest in the specialty materials and chemicals markets, the characteristics of attractive companies for investment, and our experience and value-add.

Favorable Industry Trends & Characteristics                           

  • The drive for fuel efficiency leads to increasingly lightweight specialty materials in the Aerospace and Automotive markets
  • Technological advances in the growing Medical market create a need for biocompatible specialty materials, sterile resistant adhesives, and surgical adhesives to name a few
  • The trend towards miniature electronic components spurs demand for specialty materials with rapid setting paces and extreme temperature resistance
  • Niche products with unique performance enhancing characteristics enjoy higher than average profit margins and higher customer loyalty

 

Seeking Companies with these Characteristics

  • Sales $15 million to $75 million and Proforma EBITDA $2 million to $10 million
  • Gross Margins: +35% for Manufacturers, or +25% for Value-Added Distributors
  • Headquartered in the United States
  • Products used in extreme temperatures and/or harsh environments
  • Provides engineering solutions
  • End markets preferred, but not limited to:
    • Aerospace
    • Automotive
    • Construction
    • Electronics
    • Industrial
    • Marine
    • Medical
    • Transportation

 

MCM’s Specialty Materials & Chemicals Experience

We leverage our successful portfolio company experiences, current MCM board members’ specialty materials and chemicals experience, and relationships with industry executives.

 

Amrep logoAMREP – Divested, Amrep manufactures and formulates spray adhesives and specialty chemicals including aerosols, liquids and lubricants, professional cleaning                                                        and maintenance solutions, floor care, air care, grease and lubricants, herbicides and                                                        disinfectants.

 

RMB logoRMB ProductsAcquired in 2010, RMB Products is a rotatonal molder, rotational liner, and additive manufacturer of engineered thermoplastic products used in niche applications. RMB utilizes a proprietary binding agent to adhere  thermoplastics to pipes, fittings, and   other steel related products.

 

CVM logo

 

CV Materials – Divested, CV Materials is a manufacturer of metallurgical  powders, fluxes and porcelain enamel coatings.

 

 

Dexmet logoDexmet – Divested, Dexmet manufactures precision expanded metals, foils, and thermoplastics primarily used as lightning strike protection. Dexmet’s proprietary products are applied to the top adhesive layer of the composite aircraft.

 

 

advanced ceramics logoAdvanced Ceramics – Divested, Advanced Ceramics is the world’s largest producer of boron nitride powders, shapes, and coatings, as well as other specialty ceramics.

 

MCM Senior Operating Partner Mr. Harry Shimp served in General Electric’s High Temperature Materials Division for 10 years and has operated a number of engineered materials companies.

 

MCM has relationships with Specialty Materials and Chemicals Executives who may act as integral members of future portfolio companies.