Can you share Altivia's origin story and its growth into a large privately owned company?
Altivia's journey began in the mid-1980s when I transitioned from the oil and gas business, notably after the 1986 crude price crash, to founding Altivia as a water treatment chemicals producer. Over the years, we expanded our product range and evolved our business model, leading to the sale of our initial business to Brenntag in 2012. This sale marked a turning point, enabling us to invest in more complex and technologically advanced ventures. Since then, Altivia has grown significantly, acquiring and restructuring four major facilities, and today, we supply products globally, manage a substantial distribution network, and have nearly reached $1 billion in revenue.
What strategy has driven Altivia's growth, especially through acquiring distressed businesses?
Our growth strategy over the past decade has been to identify and acquire distressed businesses with the potential for turnaround.
We leveraged our first 25 years of experience to develop a playbook that focuses on operational efficiency, superior customer service, and a nimble response to market needs, distinguishing us from larger, less agile competitors. This approach has allowed us to revitalize these businesses, support their employment bases, and successfully penetrate global markets.
Altivia operates its various entities separately but with shared management and back-office services, ensuring accountability and encouraging ownership. This structure allows each production unit to be responsible for its success or failure, promoting a culture of efficiency, productivity, safety, and quality. Our integrated approach across manufacturing, distribution, and logistics has been key to our success, enabling us to manage a complex array of operations while maintaining financial viability.
What is the greatest challenge facing Altivia today?
The most significant challenge for Altivia post-COVID has been securing professionals. The pandemic created a perfect storm, with trade and labor shortages exacerbated by government benefits, leading to a persistent scarcity of skilled professionals. This issue remains a critical concern as we strive to continue our growth and operational excellence.
When you think of the American Chemistry Council and the efforts to attract a younger workforce to the chemicals industry, what is being done?
The American Chemistry Council (ACC) has evolved significantly over time, originally focusing on large chemical producers in the U.S. and now including global producers, small companies, and entities involved in chemical distribution, trading, and manufacturing. This broadened scope allows for a diverse exchange of knowledge and practices among companies of all sizes, facilitating a collective effort to attract talent to the industry. The ACC serves as a primary conduit for expressing the industry's needs and opinions on regulations to the government, playing a vital role in advocating for the chemicals sector and attracting new talent by highlighting the industry's critical role in the economy and its vast opportunities.
Looking ahead, what do you believe will be the biggest hurdles for the chemicals industry, especially with the ongoing energy transition?
The chemicals industry faces several significant challenges, including competition from international producers with free access to U.S. markets, who benefit from lower operating costs due to fewer regulations and government subsidies. This situation is exacerbated by the current economic environment in Asia, leading to increased reliance on the U.S. market. Furthermore, the industry is grappling with the concept of globalization, where low-cost production often overlooks environmental, safety, and human rights considerations. Another pressing issue is the U.S. government's failure to secure critical raw material supplies, leaving the industry unable to compete with foreign governments' strategic acquisitions, which could lead to a dire situation in terms of resource availability in the future.
In response to challenges like securing raw materials, how can the government, the industry, and organizations like the ACC collaborate effectively?
A major shift is anticipated in the chemicals industry and others, reversing the globalization trend and bringing production capacity back to the U.S. This shift, driven by geopolitical uncertainty, supply chain disruptions, and national security concerns, necessitates substantial capital investment, professional training, and streamlined government regulations. Addressing the challenge of securing global sources of key raw materials requires a public-private partnership that leverages industry know-how with government capital and relationships. Such collaboration is essential for ensuring access to critical resources and maintaining America's growth and competitiveness in the chemicals space.
What impact do technological advancements, such as automation, AI, and digital transformation, have on Altivia and the chemicals industry at large?
The U.S. chemical industry has seen significant technological evolution, with a strong R&D foundation supporting customer needs, including advancements in the EV industry. AI, while still in a learning phase for chemical process technology, is recognized as crucial for maintaining global competitiveness, with governments viewing AI as strategic to national security. Altivia is exploring AI applications in repetitive functions across various departments, acknowledging that while technology development is progressing, there's still much to explore and adopt to enhance efficiency and innovation.
Looking forward to 2024 and beyond, what growth strategies does Altivia plan to employ?
Altivia aims to continue its growth through a two-pronged approach: organic growth, such as expanding capacity and product lines within existing facilities, and opportunistic acquisitions of underperforming assets that can be improved to meet market requirements. This strategy reflects a balanced approach to growth, leveraging both internal capabilities and external opportunities to enhance the company's product mix and financial sustainability.
As a key player in the chemicals industry, what message would you like to convey to Newsweek readers who may have misconceptions about the industry?
The U.S. chemical industry is poised for a positive shift, with the return of production capacity to the U.S. being a significant factor. This resurgence is supported by the country's raw material base, professional innovation, and an entrepreneurial spirit that drives smaller, nimble, and aggressive industry participants. The future looks promising for the U.S. chemical industry, thanks to its adaptability and the collective efforts of all players to address current challenges and capitalize on opportunities for growth and development.
