What does the merger of GTM and Caldic mean for the Mexican market?

Caldic has a very strong presence in life sciences, which is aligned with our focus on growing our specialty business in Mexico. Industrial chemicals is part of our day to day and we want to continue growing in that area, but our current focus is really on specialties. This is where our merger with Caldic is going to make a difference.

We are very strong in paints and coatings, and we are working to consolidate our growth in the food and pharma segments. This requires certain levels of investment by us and the brands we represent. The merger with Caldic has resulted in some changes to our portfolio. We would like our principals to see us as their logistics arm in the country, as a strategic partner to reach those clients that large manufacturers cannot directly reach. Additionally, through the merger of Caldic with Connell, which is subject to final approvals, we will expand our capacity to bring more brands and products from Asia.

Are you focusing on new talent acquisition as you shift towards specialties?

The entire organization is adapting to this new focus. Before, we had sales people that dealt with both industrial chemicals and specialties, but that has changed. We no longer have mere sales people; we have technical teams that add value to clients through knowledge and product development. Clients should not knock on our door for spot trades. Rather, we aim to build longer-term relationships with our clients.

What opportunities do you see in Mexico for distribution?

Mexico is a strategic provider to the US in every single industry that requires specialty solutions: food, pharma, paints and coatings, construction, etc. Mexico is also the country with the largest number of free trade agreements across the world, so there are great opportunities to do business with other nations. Moreover, the process of nearshoring is putting Mexico in the spotlight as one of the largest receivers of investment as supply chains re-regionalize.

While Brazil is overall a larger market, the opportunity to grow in the distribution segment is somewhat bigger in Mexico than in Brazil. So, there is room to grow at double-digit rates in specialties in Mexico over the next five years, and that is our goal. We want to become the leader in specialty distribution in the country.

How is your product portfolio becoming more sustainable?

We have a team permanently looking for new products, and as part of this process we constantly look at reducing the use of synthetic products or replacing those products altogether with the use of ecological raw materials. As a company, we have a commitment to reach zero emissions by 2024. Through our ‘New Product Introduction Platform’, we identify opportunities for new products in terms of how we can generate solutions for particular industries and clients. For example, we represent a company from Finland, FP Pigments, that has a product that reduces the usage of titanium dioxide in resins. This has a cost reduction implication, but also allows for lower emissions.

Logistics is a key element for a distributor. What are your strengths in this area?

We have a Houston office dedicated to logistics, and we have a strong position when it comes to negotiating shipping rates and better itineraries thanks to the large volumes we handle – that is an advantage for both our clients and our principals. All this said, while we are a very large company with Caldic, and will be even bigger with Connell, we are still a very agile company in Latin America.

What are the prospects for the company in the years to come?

We aim at having sustainable growth and being recognized for adding value across all our business lines. We belong to an investment fund, and the idea is to continue growing. This can be achieved via organic growth and via acquisitions. Any M&A activity has to be strategic. We are currently looking for opportunities in Mexico, and we expect 20% to 25% of our growth to come from acquisitions.