CPH in the media

"Opportunities for buyers have rather increased"

The corona crisis has dampened the prospects on the M&A market. Peter Schildknecht, CEO of the CPH Group, sees rather increased opportunities for buyers with the current high level of uncertainties in the market, as he explains in an interview with Oaklins M&A Outlook Switzerland.


What influence does the corona crisis have on CPH's business activities?

The CPH Group is active in three completely different business areas. With Perlen Papier, we are the largest recycler of recovered paper in Switzerland and the only producer of newsprint and magazine paper. Zeochem is the leader in silicate chemistry and Perlen Packaging is one of the world's largest suppliers of films for blister packaging for the pharmaceutical industry. The markets in which our divisions are active are affected by the corona crisis in very different ways.

Which divisions are particularly affected by the exceptional situation? 

The Chemistry and Packaging Divisions have production plants in China. We were given a demonstration at the beginning of the year of what we could be facing in Europe and the USA. Accordingly, we introduced a wide range of measures within the Group at an early stage to maintain our entrepreneurial performance. The fact that we have production facilities in China, Europe and America was a great advantage, enabling us to balance capacities and maintain our ability to deliver. On the demand side, the Paper Division in particular has been negatively affected by the Corona pandemic. Newspapers, for example, had to reduce their volume significantly as advertisements were no longer placed. On the other hand, we were able to benefit from the strong demand from the pharmaceutical industry in the Packaging Division.

What operational and strategic measures have you taken as a result of the COVID crisis?

... this could fill entire pages. So just one example: In Switzerland, we had to ensure that our production facilities could continue to operate even in the event of a hard lockdown. We were able to demonstrate that the products from all three of our divisions are of great importance for the country's economic supply, and they were accordingly classified as systemically relevant. This meant that we would have been permitted to maintain operations at our Swiss production facilities whatever happened. Within the Group, we already had pandemic plans in place when SARS broke out, and we have fortunately reviewed and updated these emergency plans in 2019. So the corona pandemic did not catch us completely unprepared. At all locations and with over 1,000 employees, we only had one case that tested positive for corona. 

Are M&A activities a topic for you in the current environment? 

M&A is a strategic topic. We have set ourselves the goal of further strengthening the Chemistry and Packaging Divisions in relation to the Paper Division. In addition to organic growth, this naturally also includes acquisitions. 

Do you actively look out for takeover candidates? 

The Chemistry Division is relatively small. With sales of around CHF 80 million, it accounts for only 15% of the Group's sales of CHF 525 million. We are specifically looking for opportunities in this area to grow through acquisitions.

What opportunities do you see for your company in the current environment? 

I think the opportunities for buyers have rather increased in the current environment and with the present high uncertainties in the markets. This could mean that the sellers' price expectations have to be revised downwards or that, as a result of these market distortions, a company suddenly comes onto the market where there was previously no intention to sell.