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Reinhard Gradl


Reinhard works with our Industrial team in the area of chemicals, focusing on how to achieve growth in an industry that is still based on commodity products. Reinhard’s experience has been key to the development of two Advent chemicals investments, OXEA and H.C. Starck.

“A good operating partner must have deep knowledge of the business, the partners, what the competitors are doing - the whole industry and market.”
Reinhard Gradl


Reinhard Gradl has been in the chemicals industry for more than 35 years. With a PhD in chemistry and experience in R&D and Operations, as a general manager, and in the boardroom – including many years with Hoechst and Celanese – Reinhard brings a unique perspective on how to achieve growth in the international chemicals sector. At OXEA, Reinhard has led implementation of an industry-leading strategy that shifted the business focus away from intermediate chemicals and toward higher-margin specialty products.

How would you describe your business philosophy?

My focus is on increasing the value of the company by improving the fundamentals. From the first day at Oxea, I started working with my colleagues on analyzing the business, its capabilities and its competitive position. Then we started to develop the strategy and implement it. All the time we were monitoring the economics of different projects across all business areas with a focus on the value they could bring.

How did you first become involved with Advent?

At Celanese, one of the world’s largest chemical companies, I was responsible for the Intermediates business, which is similar to what OXEA has today. Because this was not a core business for Celanese, there wasn’t much support for projects with paybacks longer than six months, making it difficult to do anything.

In fact, the business had been scheduled for sale for quite some time. In 2003 we formed a joint venture in Europe between Celanese and Degussa, which I initiated and implemented. Once retired in 2005, consultants and private equity houses called me, and I was approached by a number of companies in the industrials sector. I did some consulting and projects, as well as due diligence work in other areas.

Then, one day Advent called and interviewed me. Advent’s approach is to find people who are knowledgeable about the business they want to buy. I enjoyed talking with Advent. They bought the business at the end of 2006 and named it OXEA, and I came on board as executive chairman.

Describe your role as an Advent operating partner.

My introduction into the operating partner program was atypical, because I hadn’t previously worked with Advent on finding deals. Unlike many of my operating partner colleagues, I didn’t know what to expect. From the beginning of my time as an operating partner, though, I found it very interesting.

When Advent and I began forming the management team for OXEA, we chose not to have a CEO, instead opting for a traditional German model of joint responsibility for the board members. In addition to the staff, we retained two of the senior leaders with whom I had worked previously on the Celanese team. There are now three managing directors--one in charge of operations and technology, another overseeing finance and the third responsible for all commercial aspects.

I have an executive chairman role, guiding the management team. I serve as the link between the team and Advent. This role keeps me fully involved in the strategy, which is something I like, and I don’t show up in public. It is a unique role and one that works well.

With which Advent investments are you involved? In what role? What have you focused on?

Primarily I am an executive chairman at OXEA. I have been involved with Advent in developing and implementing the strategy, which has been a real success story. OXEA is now the world’s second-largest producer of Oxo chemicals. The strategy that I proposed to Advent was that we combine two businesses into one company. Through this combination, we could then grow the company by concentrating on specialty chemicals.

This was a new strategy for the Oxo industry, much of which was – and still is – focused on big-volume commodity chemicals, known in the industry as intermediates. While OXEA still produces intermediates like alcohols and acetate esters, we expanded heavily into specialty chemicals ¬or downstream derivatives like polyols, acids, and amines and specialty esters. The industry hadn’t yet seen this as a growth strategy. We did, though, and we built on it. Though it was once an underdeveloped idea, specialty chemicals now represent a larger market than intermediates. In the near future, I expect specialties to account for the majority of gross margins.

In addition, I have a non-executive director role in the second German chemical firm in Advent’s portfolio, H.C. Starck.

What has been your greatest challenge?

The biggest challenge for an operating partner is to encourage and motivate the team to keep up with the speed of business development. As an operating partner, you have to guide management teams and motivate them. I can put a lot of pressure on my team, and sometimes I feel guilty because we have many projects going on at once and it can be hard to prioritize. Patience is not my best skill. However, as a former divisional head, I know what it’s like to be in the management team’s shoes as well.

What have you enjoyed most as an Advent Operating Partner?

Private equity – and Advent in particular – was a blessing for OXEA. OXEA was an underdeveloped company, and Advent came in and said, “Let’s build it.” Because Advent’s timeframe is inevitably limited, it takes an urgent approach, making quick decisions and changing the culture of the organization. Unlike many businesses, which have executive committee meetings every month, or even less frequently, we don’t have to postpone making decisions. We have teleconferences between meetings to speed things up. The speed of implementation sets private equity apart.

In 35 years in the chemicals business, I had never seen anything like it. And it is what has made the partnership with Advent special. As soon as the strategy is defined or a project is identified as being attractive, it is implemented without hesitation. It is driven by a sense of urgency and at the same time with a constant view on the economics. There are fewer committees, and the strategy can’t wait. And that’s exciting. It enables success. It’s like being on a speedboat compared to large public companies, which are more like big ocean vessels.

What advice would you offer someone thinking about becoming an Advent operating partner?

Advent will want to be involved and have a very open dialogue in order to accelerate the needed changes at the company, but as much as possible leave it to you to manage day to day. When OXEA was first starting, I talked with Advent on a daily basis. And today we still exchange e-mails daily. I discuss all strategy with Advent. They know exactly what is going on and, because they are well-connected in the industry, they are able to offer resources to support those ideas.

This level of interaction has a real advantage. Advent was not shy of doing a complicated deal with many difficulties and hurdles but that would have real benefits to the company. Advent challenged me; they made sure that I knew what I was getting into when I proposed shifting the OXEA portfolio. They heard my case, they believed it, and they supported the strategy.

What does it take to be an effective Advent operating partner?

You need to know the business. It is easy for me to develop strategy and follow through with it, because I know the company, the suppliers, the competitors, etc. I’m a business insider. A good operating partner must have deep knowledge of the business, the partners, what the competitors are doing – the whole industry and market.

When I first started working with Advent, I was amazed to learn how many contacts everyone in the chemicals group has. This group of five or six operating partners and Advent professionals covers the chemicals space around the world. If a new idea pops up, at least one person knows the business or knows someone who knows the business.

Why do you choose to work with Advent?

I like the people within Advent’s organization because they don’t only focus on merely financial data. I like how Advent tries to understand and approach the business and evaluate the chances and the risks. They find people who are knowledgeable about the business they want to buy, and they offer the leeway to create a strategy that doesn’t require payback in six months. I like the urgency of the pace and the willingness to implement new strategies. This kind of approach has been integral to OXEA’s success.

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Conor Boden

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