Hexion's Acquisition of Smartech: A Game Changer for AI in Manufacturing

In a significant development for the manufacturing sector, Hexion Inc., a renowned leader in adhesives and performance materials, has announced its acquisition of Smartech, a cutting-edge firm known for its AI-driven autonomous manufacturing solutions. This bold step marks Hexion's first acquisition in a decade and outlines a clear strategy to embrace advanced AI technologies that promise to transform production dynamics within the industry.

A Strategic Acquisition

Hexion's decision to integrate Smartech into its operational ecosystem exemplifies a forward-thinking approach in a market increasingly influenced by technology and sustainability demands. The acquisition not only positions Hexion at the forefront of smart manufacturing but also strengthens its capability to offer innovative products and solutions tailored for a rapidly evolving sector.

Michael Lefenfeld, President and CEO of Hexion, emphasized this moment as a turning point for the company. He stated, "This a defining moment for Hexion as we integrate Smartech's world-class artificial intelligence and automated manufacturing capabilities with our unmatched expertise in resins and wood processing." This merger aims to navigate existing challenges like rising raw material costs, supply chain disruptions, and environmental regulations.

Enhancing Efficiency and Sustainability

What sets Smartech apart is its award-winning AI and autonomous manufacturing technologies that merge artificial intelligence with advanced control systems and process optimization. Its flagship products like SmartWAX, SmartPF, and SmartMDI align seamlessly with Hexion's offerings—creating a potent combination that stands to redefine operational standards in the adhesives and construction sectors.

A prime example of this synergy is the SmartMDI system, which utilizes dynamic chemistry control to enhance the precision of resin applications in engineered wood production. This technology not only improves surface coverage and reactivity but also significantly reduces raw material costs and lowers VOC emissions. Facilities utilizing the SmartMDI system can realize cost savings exceeding 15% per mill, showcasing the dual benefit of economic and environmental advantages.

Navigating Industry Transformation

The acquisition aligns with Hexion's five-year transformation strategy, initiated under the ownership of American Securities in 2022. This strategy aims to realize short-term value while positioning Hexion for future leadership—capitalizing on innovation and operational excellence in a century-old company rapidly adapting to market demands. Hexion's commitment to sustainability is reinforced further through this acquisition as it seeks to deliver meaningful, environmentally-responsible manufacturing solutions.

Hanoch Magid, CEO of Smartech, echoed this sentiment, noting their shared vision of sustainable innovation. He stated, "Our partnership with Hexion will further amplify the reach and impact of Smartech's AI technologies across the globe, bringing immediate value to manufacturers who must balance cost control, plant modernization, and environmental responsibility."

The Road Ahead

With Smartech continuing to operate independently, the integration of their resources and expertise into Hexion’s business model signifies a compelling shift in how traditional manufacturing practices are approached. By fostering an environment of collaboration and innovation, Hexion and Smartech could very well set new industry benchmarks in digital automation and sustainable practices.

The financial aspects of this acquisition remain undisclosed, yet the implications of this union are poised to transform manufacturing paradigms significantly. As Hexion embarks on this journey with Smartech, the commitment to revolutionizing the manufacturing ecosystem, particularly in the wood processing industry, signifies a commitment to not only meet current demands but to anticipate future needs, ensuring resilience in an ever-changing landscape.

To learn more about Hexion and Smartech, visit their respective websites at Hexion and Smartech.