German major Henkel sees significant growth potential in Middle East

The multinational consumer and industrial group Henkel sees significant growth potential in the Middle East and Africa region, including through mergers and acquisitions (M&A).

“The region is very interesting for us. It will be a combination of organic and M&A-related business transformation,” said Carsten Knobel, CEO, at the newly launched Henkel Inspiration Centre in Dusseldorf, Germany.

“M&A is an integral part of our investment strategy,” said Knobel in exclusive comments to Gulf News. “We’re looking in all respective areas of the world, I would say not only in the mature regions of North America and Europe, but also emerging and high growth regions, be it Asia, Middle East and Africa, or Latin America, in order to drive the business forward.”

While Henkel maintains a balanced focus on its two business units, Henkel Consumer Brands and Adhesive Technologies, Knobel said the company sees M&A opportunities primarily in the Adhesive Technologies segment, while the consumer brands segment is undergoing consolidation.

According to Knobel, potential opportunities for M&A have to meet stringent criteria.

“Availability, strategic alignment, and financial attractiveness are important. We have implemented a rigorous and disciplined process to ensure that any M&A activities contribute to the overall value creation for our company, aligning with our mid- to long-term objectives,” he said.

In terms of financial performance, Henkel reported more than 22 billion euros (Dh86.3 billion) in revenue in 2022, with equal contributions from the Adhesive Technologies and Consumer Brands business units. Sales in the Middle East and Africa region were up year-on-year at 1.3 billion euros. Organically, the region posted sales growth of 7 per cent. Henkel has more than 850 employees in the GCC, out of 52,000 globally.

The company’s top brands in the GCC region in the Adhesive Technologies segment are Technomelt, Polybit, Pritt, Pattex and Loctite, while Persil, DAC, Fa, Got2b, Taft and Palette are its leading consumer products.

“The GCC holds significant potential for the growth of our industrial and consumer businesses in Adhesive Technologies,” said Mark Dorn, Executive Vice President, Adhesive Technologies at Henkel. “This region offers a wide range of prospects for innovation, particularly in the fields of sustainability, mobility, digitalisation, and construction. As a result, we are committed to further investing in this region to provide our loyal local customers with impactful and sustainable solutions.”

Henkel Construction Adhesives, part of the company’s Adhesive Technologies unit, has been involved in numerous prestigious infrastructure and building projects in the GCC, collaborating with public and private sector entities. These projects include well-known landmarks such as Burj Khalifa, Palm Jumeirah, Expo 2020 Dubai, the Abrahamic Family House, the Green Riyadh project, and the Hatta Pumped Storage Hydropower Plant.

Dubai’s e-mobility vision

Henkel’s expertise in adhesive technologies, battery assembly, lightweighting, thermal management, and collaborative innovation positions the company as a valuable partner in supporting Dubai’s e-mobility vision, said George Kazantzis, Corporate Vice President Automotive Components at Henkel Adhesive Technologies.

By providing specialised solutions, knowledge sharing, and fostering collaboration, Henkel can contribute to the successful implementation of sustainable e-mobility solutions in Dubai, he added.

“As a pioneer in offering innovative solutions to the mobility industry, we are thrilled to be part of Dubai’s visionary journey towards future mobility solutions within the GCC,” said Kazantzis. “We eagerly anticipate the tremendous possibilities that lie ahead.”

Bringing innovation to the world

Henkel recently unveiled its impressive new Inspiration Center Dusseldorf (ICD) with a significant investment of 130 million euros. Strategically located at the company’s headquarters, the state-of-the-art global innovation and customer centre boasts 30 cutting-edge laboratories, four advanced technology centres, and houses a team of more than 650 Henkel experts.

“We want to bring the innovation to each market that we operate in and create value for our customers,” said Carsten Knobel, Chief Executive Officer. “And the ICD will help in that regard.”