02/16/2024
The recent acquisition of the MBCC Group positions Sika as the undisputed market leader in construction chemicals with a market share of 11%, more than double that of the next competitor. As Sika integrates MBCC’s global footprint, exceptional brands, and high-performance products, the company is better positioned to address evolving customer needs and sustainability challenges.
Sika has a wealth of experience in integrating acquired companies. In the past ten years alone, the company has completed some 40 acquisitions, creating lasting value for employees, customers, and other stakeholders. But the acquisition of the MBCC Group is something special. Like Sika, the MBCC organization has a reputation for innovation and customer focus, but it also has a global footprint of manufacturing facilities, excellent brands with high-performance products, and strong distribution channels. MBCC’s best-known brands include: Master Builders Solutions, PCI, Thermotek, and Watson Bowman Acme.
"The integration is a fantastic opportunity to enrich Sika’s portfolio, access new markets, and enlarge our know-how and expertise. We are embarking on an exciting journey that will add value for both our employees and our customers." Ivo Schädler, Head Construction
Coming home
MBCC has changed hands several times over the past decades. Now it was time for its employees to finally come home to a place where they belong to the core business. After careful preparation, the integration of MBCC into Sika began on May 2, 2023. Enthusiastic celebrations around the world underscored the value Sika places on the experienced and dedicated new colleagues who are now full members of the Sika family.
Multiple dimensions of synergy
Sika and MBCC complement each other in terms of solutions, channels, geography, and supply chain. Only a few months after closing, it become clear that the opportunities for the combined businesses were even more promising than originally expected and the synergy target was raised by CHF 20 million to CHF 180–200 million. This amount will be generated in the following years through cost initiatives (65%) and through additional sales (35%), with the full amount expected to be achieved in 2026. Sika has an outstanding reputation for providing complete solutions for entire projects from a single source. MBCC adds many more complementary products that allow Sika to offer even better solutions to reduce overall construction time, conserve water, or lower the carbon footprint.
Synergy development – expected ramp-up until 2026
More comprehensive solutions
Water scarcity is a growing concern in many parts of the world. With the integration of MBCC, Sika now has a complete offering for water infrastructure applications. The Sika MonoTop®, Sikalastic®, and Sikagard® ranges have been complemented by the best MBCC MasterSeal products, partly based on the Xolutec® technology. This technology is a crack-bridging membrane for reinforced concrete structures in challenging environments. In particular, it is resistant to biogenic sulfuric acid, making it a perfect choice for seamlessly sealing water treatment plants, biogas plants, and reservoirs. With the combined, comprehensive product range, Sika covers the requirements for all water infrastructure projects – from repair and rehabilitation to new construction.
Growth via improved channel access
Thanks to former MBCC’s presence in distribution channels, Sika now has broader reach and channel access. For example, with PCI in German-speaking countries. The brand is known as a formidable tile setting product with a strong positioning in the distribution channel, where it generates 80% of its sales. Sika, on the other hand, did not have such a strong presence in tile setting materials, or in distribution in the DACH region. Acquiring PCI in the context of the MBCC acquisition is a valuable opportunity for Sika to pave the way for cross-selling of additional Sika products.
"We are grateful for the warm welcome we received from Day One. Being a part of the Sika family and driving the business forward together is highly motivating." Hendrik Heising, Head Global Operations & EHSQ and previously Chief Operating Officer at former MBCC Group
Opportunities through the expanded geographic footprint
In many countries, the geographic footprint is highly complementary, providing opportunities for additional sales and synergy generation. In Japan, for example, Sika had admixture plants in Tokyo and Osaka, while MBCC had facilities throughout the entire country. With the newly expanded presence, Sika can improve logistical efficiency, expand the offering through cross-selling, and better tailor product formulations to the diverse needs of local construction projects. Another example is Mexico, where Sika had two plants manufacturing waterproofing solutions. Together with MBCC, Sika now has a total of six facilities, providing better coverage of the entire country and improved customer reach with the expanded product portfolio.
Synergy effects in the supply chain
The first area of focus for synergy generation has been procurement. Initiatives aim to optimize Sika’s material cost. They include harmonizing prices for identical raw materials or exploration of more cost-effective raw materials from alternate suppliers.
The integration of MBCC offers Sika further opportunities to improve operational efficiency and customer proximity. Region by region, the company will align its footprint with customer opportunities, optimize and automate, and increase the digitalization of the customer journey and support processes. Initiatives include site specialization to improve manufacturing efficiency or optimization of the warehousing and logistics footprint.
As the integration has successfully progressed over the year, Sika has proven time and again how well both companies complement each other. With a global footprint of more than 400 factories, and a broader range of solutions and technologies, Sika is the clear leader in helping customers reduce CO2 emissions and driving sustainability improvements in the industry.