Securing the Canadian Frontier: New article about Canadian Chemical Distribution Market
15 August 2019
Azelis had set its sights on strengthening its presence in Canada, and acquiring Chemroy earlier this year clearly achieves that goal. We spoke to Frank Bergonzi, CEO and President, Azelis Americas and JP Pelchat, Managing Director, Azelis Canada, to find out more.
We were delighted to have the opportunity to speak with Frank Bergonzi and JP Pelchat to find out more about the company’s plans for North America and their strategy for this region. Azelis, a leading distributor of speciality chemicals and food ingredients, acquired Chemroy, a Canadian distributor of speciality chemicals and food ingredients, in March of this year. Frank Bergonzi, CEO and President of Azelis Americas, said at the time, "With the acquisition of Chemroy, we have established a stronger footprint in Canada. This is an excellent strategic fit and we are excited by the opportunity for continued growth, in both Canada and the US.”
Canada has a highly developed economy, with 10th largest GDP in the world. It has the fourth highest total estimated value of natural resources, and the world's third largest petroleum reserves. The country also has a sizable manufacturing sector (especially the automobile and aircraft industries), is a global leader in the entertainment software industry, and is one of the world's largest suppliers of agricultural products. It goes without saying, at least to readers of this magazine, that these sectors all require speciality chemicals.
In fact, according to the Chemical Industry Association of Canada (CIAC), in 2017 the speciality chemicals industry was valued at CAN$52 billion (approximately US$32 billion) and supports 525,000 jobs in Canada. With developed markets for pharmaceuticals, agrochemicals, personal care products, paints and coatings, adhesives, resins and rubbers, printing inks, pigments, all part of the $19 trillion North American Free Trade Agreement, this is clearly an important market for speciality chemicals manufacturers and distributors. This huge potential certainly explains Azelis’s interest in the region.
“Azelis Canada activities are concentrated in the Canadian market offering a complete portfolio of chemistries and products to our customers from diverse industries,” Bergonzi told us. “We service each business sector through our dedicated and technically-focused sales people. Our market segments in Canada are: CASE, Food & Health, Personal Care (and HC&IC), Pharma and Essential Chemicals, Lubes & Metal Working Fluids, Oil & Gas, Pulp & Paper and other industrial sectors.”
Referring specifically to the recent acquisition of Chemroy, Bergonzi adds, “We look for best-in-class companies and we work with their management teams for smooth and seamless integration into the Azelis family. Our objective is to work together with an open mind, learn from each other, share our best practices and continue to grow our customers' and principals' businesses.”
Clearly recognising the value of the industry to its economy, the Canadian government has demonstrated particular support for the chemicals industry in recent years. It has taken a unique and forward-looking approach of encouraging growth of the chemicals industry while maintaining an ecological balance. Reflecting this national focus on sustainability, members of CIAC are signatories to Responsible Care – the association's UN-recognised sustainability initiative that inspires its members to take actions that improve the sustainability of their operations and reduces harm throughout the entire life cycle of their products. We asked JP Pelchat if the Canadian government’s stance on the industry had influenced Azelis at all.
“Government rules and regulations definitely influence the Canadian Chemical industry and it is part of daily life for all Canadian distributors and producers alike,” he answered. “Azelis is well versed on the regulatory front, a leader in the industry and we continue to grow, while adapting and supporting the positive impact to the environment. We endorse the reduction of our carbon footprint in our daily activities which are measured by EcoVadis on a yearly basis. In recognition of these efforts, Azelis was awarded gold rating in 2018, placing us in the top 1% of all distributors evaluated by EcoVadis.”
Looking ahead to the future, “For now, we are focussing our efforts on the integration and amalgamation of Chemroy into Azelis Canada, which we expect to be completed in 2020,” said Bergonzi. “Longer-term, our strategy continues to be sustainable organic growth, with added inorganic growth via M&A.”
Terry Mullin, Corporate Communications at Azelis Americas
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