Mr. Silversteyn: Yes, specialty chemicals is a diverse universe of companies, probably about 60 publicly traded names, and they provide investors with the ability to exploit just about any secular or mega-trend thesis that they may have. And these companies tend to be in 2 billion to 5 billion market cap range for the most part. There are some larger ones and some smaller ones, so they are suitable for small- to mid-cap investors, either value or GARP, which is growth at a reasonable rate, and even growth stock investors in some circumstances.
TWST: Are there certain unifying trends in some of the companies that you like?
Mr. Silversteyn: What we look for, as a general rule of thumb, is a dominant market position. We want to be investing in market leaders or sector leaders rather than the weak sisters. We're looking for these companies to be participating and selling into markets that are amenable to growth - not necessarily semiconductor type of growth, but certainly some sort of a GDP-plus-growth market. We are looking for them to have sustainable competitive advantages that will keep them at the top-of-the-league tables, whether it's global breadth, breadth of materials, manufacturing excellence, marketing excellence or whatever it may be. So we are not talking about brick-and-mortar-type assets, but something more internal, having to do with the business model of the company. And then the last but certainly not the least thing that we look at is management talent. Specialty chemicals, by their very name, imply the ability to grow in almost any economic scenario. Management teams have to execute and earn their lunch, so to speak, every day. This isn't a commodity universe where you can blame the cycle when things go bad and take credit when the cycle is working for you. So management talent really is an important factor in company performance and stock performance.
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