H.B. Fuller Has Completed 13 Acquisitions Since 2023 Despite Investor Pushback

Thirteen acquisitions in under three years is an aggressive pace by any standard, and it's exactly the kind of number that activist investors like Ancora Holdings have pointed to when questioning H.B. Fuller's capital allocation strategy. But the company is pushing back with a different set of figures: over the same stretch, net debt-to-adjusted EBITDA has actually improved, falling to 3.1x from 3.5x a year earlier. The tension between those two data points, an accelerating deal count and a strengthening balance sheet, sits at the center of the current debate over H.B. Fuller's strategy.

The Pace of Dealmaking Since 2023

Thirteen completed acquisitions since 2023 works out to roughly one deal every two to three months, sustained over nearly three years. That's a notably fast clip for a company of H.B. Fuller's size, and it reflects a deliberate strategy under CEO Celeste Mastin to reshape the company's portfolio toward higher-growth, higher-margin categories, medical adhesives chief among them, rather than relying primarily on organic growth within its legacy industrial and packaging adhesive businesses.

A few things are worth understanding about what a pace like this typically signals:

• Frequent, smaller-scale acquisitions are often used to build out capability and market position incrementally, rather than betting the company's strategy on a single transformative deal.

• Sustained M&A activity at this frequency usually requires a well-developed internal deal evaluation and integration process, since the operational burden of continuously absorbing new businesses compounds over time.

• It also tends to draw increasing shareholder scrutiny the longer it continues, particularly if debt metrics move in the wrong direction, which is precisely the concern investors like Ancora have raised.

Why the Debt Trajectory Matters More Than the Deal Count

Deal count alone doesn't tell you much about whether an acquisition strategy is financially sustainable. Leverage does. H.B. Fuller's net debt-to-adjusted EBITDA ratio improving to 3.1x from 3.5x a year earlier is the figure management is using to argue that its dealmaking pace hasn't come at the expense of balance sheet discipline.

That improvement matters for a few reasons. A declining leverage ratio while simultaneously completing 13 acquisitions suggests the company has been financing at least part of its deal activity through organic cash flow generation and earnings growth, rather than relying purely on additional debt. It also gives the company more flexibility to absorb the AMS transaction without pushing leverage to levels that would typically concern credit rating agencies or lenders. And it directly counters the narrative that H.B. Fuller has been acquiring recklessly, since a company taking on excessive risk through serial dealmaking would typically show leverage moving in the opposite direction.Thirteen acquisitions in under three years is an aggressive pace by any standard, and it's exactly the kind of number that activist investors like Ancora Holdings have pointed to when questioning H.B. Fuller's capital allocation strategy. But the company is pushing back with a different set of figures: over the same stretch, net debt-to-adjusted EBITDA has actually improved, falling to 3.1x from 3.5x a year earlier. The tension between those two data points, an accelerating deal count and a strengthening balance sheet, sits at the center of the current debate over H.B. Fuller's strategy.

The Pace of Dealmaking Since 2023

Thirteen completed acquisitions since 2023 works out to roughly one deal every two to three months, sustained over nearly three years. That's a notably fast clip for a company of H.B. Fuller's size, and it reflects a deliberate strategy under CEO Celeste Mastin to reshape the company's portfolio toward higher-growth, higher-margin categories, medical adhesives chief among them, rather than relying primarily on organic growth within its legacy industrial and packaging adhesive businesses.

A few things are worth understanding about what a pace like this typically signals:

• Frequent, smaller-scale acquisitions are often used to build out capability and market position incrementally, rather than betting the company's strategy on a single transformative deal.

• Sustained M&A activity at this frequency usually requires a well-developed internal deal evaluation and integration process, since the operational burden of continuously absorbing new businesses compounds over time.

• It also tends to draw increasing shareholder scrutiny the longer it continues, particularly if debt metrics move in the wrong direction, which is precisely the concern investors like Ancora have raised.

Why the Debt Trajectory Matters More Than the Deal Count

Deal count alone doesn't tell you much about whether an acquisition strategy is financially sustainable. Leverage does. H.B. Fuller's net debt-to-adjusted EBITDA ratio improving to 3.1x from 3.5x a year earlier is the figure management is using to argue that its dealmaking pace hasn't come at the expense of balance sheet discipline.

That improvement matters for a few reasons. A declining leverage ratio while simultaneously completing 13 acquisitions suggests the company has been financing at least part of its deal activity through organic cash flow generation and earnings growth, rather than relying purely on additional debt. It also gives the company more flexibility to absorb the AMS transaction without pushing leverage to levels that would typically concern credit rating agencies or lenders. And it directly counters the narrative that H.B. Fuller has been acquiring recklessly, since a company taking on excessive risk through serial dealmaking would typically show leverage moving in the opposite direction.

The Gap Between the Numbers and Investor Sentiment

If the leverage trend is genuinely improving, why has the pace of dealmaking still drawn public opposition from a shareholder like Ancora? The disconnect likely comes down to a few factors beyond the raw debt ratio:

• Absolute debt levels remain elevated in dollar terms, even if the ratio relative to earnings has improved, and investors focused on total balance sheet risk may weigh that differently than a ratio-based metric.

• Integration risk compounds with each additional acquisition, since successfully absorbing 13 separate businesses in under three years, on top of the pending AMS deal, requires sustained management bandwidth that isn't always fully visible in financial metrics.

• The AMS deal specifically followed a stated commitment to slow down, which is a communication and trust issue as much as a financial one, and one that a favorable leverage ratio doesn't fully resolve on its own.

What This Pattern Suggests About H.B. Fuller's Strategy Going Forward

A company that has completed 13 acquisitions in under three years while improving its leverage profile is signaling a fairly confident, systematic approach to portfolio reshaping, not an opportunistic or reactive one. Whether that continues at the same pace following the AMS transaction is likely to depend heavily on how investors respond to the deal's integration progress over the coming year. Given the public pressure already in play, it would not be surprising if H.B. Fuller slows its acquisition cadence somewhat in the near term, even if the underlying financial capacity to continue dealmaking remains intact.

What Buyers Should Take From This Track Record

A company actively reshaping its portfolio through frequent acquisitions tends to bring both opportunity and complexity for its supply base. On one hand, H.B. Fuller's demonstrated ability to complete and finance 13 deals since 2023 while improving leverage suggests a company with real operational discipline behind its growth strategy. On the other, buyers working with any of the businesses H.B. Fuller has acquired over this period should expect continued integration activity, and the accompanying account, systems, and product portfolio changes that typically come with it, to remain a feature of doing business with the company for the foreseeable future.

Ready to source adhesive raw materials from verified global suppliers? Explore competitive offers on our platform today.