1. Thoughts:
M&A Outlook 2012
Ennovance Capital LLC
www.ennovance.com
For queries please contact:
Investment team:
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2. 2011 Global Recap
• M&A activity exceeded 2010 levels, but 2011 was a
relatively erratic year in terms of macroeconomic factors,
which contributed to market volatility
▫ European debt crisis and political indecision, Japanese
earthquake/tsunami disaster, U.S. political tension, sovereign credit
downgrades
• 2011 saw overall growth of 9% in Global M&A volume
from 2010*
▫ Accelerated activity was seen in the first half of 2011, with a slowdown
toward the end of the year which resulted in a moderate year-over-year
increase
▫ volume slowed during the last three quarters
▫ Financial sponsor (PE) volume was up 29% from 2010
▫ Hostile (HF/activist shareholders) volume was down 38% from a year ago
*Bloomberg. 2012 Global M&A Outlook.

3. 2011 Global Recap
• 2011 saw ongoing growth in in deal volume year-over-year*
cross-border deal volume, with
a 5.5% increase on the year* • Europe experienced a 10% boost
in activity (to $875 billion) on
• Large deals experienced a the year in the face of sovereign
resurgence in 2011, with 145 debt issues*
deals valued over $1 billion in
North America* ; however, the • 2011 had a total aggregate M&A
number of $10 billion deals deal volume of approximately
increased from 14 to 20 in 2011 $2.15 trillion (compare to 2007
peak exceeding $4T)*
• The Asia/Pacific region saw • Hostile activity of $168 billion
only modest 7.7% growth in deal was down 38% in 2011 vs. a year
volume *
ago and represented 6% of
• China continues to expand overall volume
acquisitions with a 9% increase
*Bloomberg. 2012 Global M&A Outlook.

4. Advantages and Obstacles for 2012
• The Good:
▫ More cash availability
means greater deal
potential
▫ Plenty of attractive
targets in Europe
▫ Corporate downsizing
and breakups continue
▫ Depressed valuations
exist
Source: Bloomberg

5. Advantages and Obstacles for 2012
• The Bad: European Debt as a Percentage of GDP
▫ Ongoing sovereign debt
concerns Greece
▫ Lackluster economic Italy
growth perpetuates
uncertainty Ireland
▫ U.S. political scene is Portugal
tumultuous and
unpredictable, election
approaching, tax code Germany
questions
France
▫ New and complex
financial regulations UK
complicate the process
Spain
0% 50% 100% 150%
Source: Senate Budget Committee

6. Private Equity Focus
• In America, private equity
buyers were the most
active acquirers last PE Deal Flow (United States)
year, with over $138
billion in deals*
▫ Year over year, this is a
more than 40% increase
• Private Equity deals are
growing in volume*
▫ 2011 saw seven deals
announced with
valuations over $5
billion, compared to only
one in 2010
• Plenty of divestiture in
2011
▫ Six of the top ten PE deals
last year were exits*
*Bloomberg. 2012 Global M&A Outlook. Source: Pitchbook

7. Private Equity Focus
• North America Materials and
Resources
(particularly the U.S.) 5%
remains the top region for
private equity capital flow* Financial Energy
Services 7%
9%
• In the U.S., PE investment Business
is most prevalent in the Products and
Services
business products and 32%
services, consumer
products and Healthcare
services, IT, and 12%
healthcare industries**
Consumer
• Financial Services IT Products and
experienced the greatest 13% Services
reduction in PE 22%
investment in 2011**
*Bloomberg. **Pitchbook. Private Equity Breakdown 2012.
2012 Global M&A Outlook.

8. Considerations for Y2012
• The middle market is the dominant segment in private equity
▫ In the first two quarters of 2011, 75% of PE deals were valued under $250
million*
▫ Multi-billion dollar deals receive plenty of press attention, but in reality
make up only a small percentage of all transactions
▫ Lending market is OK ($10+ million EBITDA) but cautious with greater
financing availability for low margin, cyclical businesses
▫ Within the financial sponsor universe, nearly $500 billion of available
capital and funds is beginning to expire
• A massive amount of dry powder is available for investment
▫ As of October of last year, private equity firms were sitting on over $937
billion in unused capital which will need to be invested in the next several
years**
▫ Some financial sponsors (PE firms) are motivated to invest, instead of
returning money to their investors/LPs
▫ Strategic acquirers have been very active in the market since early 2010 as
they need acquisitions to supplement organic growth and expand EPS
(large cash war-chests prompting more cash deals, moderate stock deals)
*Pitchbook **Bloomberg

9. Considerations for Y2012
• With ongoing economic woes and market
uncertainty, choice of industry is crucial to
investment success
▫ Industry contraction in sectors such as financial
services has left investors desiring dynamic and
flexible segments to get involved in
• More cross border transactions and emerging
market deals
▫ Non-cyclical segments are ripe for investment for the
long-term; Natural Resources, Consumer, FIG are hot
▫ Emerging markets transactions represented 26% of
global M&A volume in 2011 and cross border
transaction accounted for $909 billion or 35% of all
M&A activity in 2011 and was up 1% from a year ago

10. Considerations for Y2012
• The broader chemical industry possesses the diversity and
adaptability to present potential viable opportunities in the
midst of 2012’s uncertainty
▫ A host of micro-segments within the broader industry each have
unique trends and attributes with links to innumerable end user
applications
▫ Such a broad range of chemical sectors creates distinctive non-
cyclical investment opportunities free of macroeconomic stressors
• Prominent end user chemical applications are showing signs of
improvement, with plenty of room for near future growth
▫ Automobiles, construction, durable goods
• Activist Investors/hostile bids
▫ Trend towards increasing dialogue with shareholders in bid
situations
▫ More deals likely to be played out in public

11. Ennovance Capital: Chemical, chemical
related healthcare industry foscused private
equity investor.
www.ennovance.com
+1(800) 901-1006
At Ennovance, we are in one business only — that of
making private equity investments and enhancing
our portfolio companies’ value. We are not in the
investment banking, brokerage, or advisory
businesses; we have no alternative agendas.