Shares of AkzoNobel surged on Wednesday after the Dutch paints and coatings maker disclosed that it had rejected a €12.49 billion ($14.53 billion) takeover proposal from Japan’s Nippon Paint Holdings and US-based Sherwin-Williams.
The stock climbed as much as 17% in early European trading to 61.38 euros, wiping out losses accumulated earlier this year, after investors reacted positively to the premium implied in the rejected proposal.
AkzoNobel said the indicative proposal valued the company at 73 euros per share, representing a 39% premium to Tuesday’s closing price of 52.52 euros.
The company revealed that the proposed transaction involved Nippon Paint launching an all-cash offer for AkzoNobel before splitting parts of the business with Sherwin-Williams after completion.
Rival bidders planned asset split
Under the structure outlined by AkzoNobel, Nippon Paint would retain the company’s decorative paints and industrial coatings operations.
Sherwin-Williams, meanwhile, would separately acquire AkzoNobel’s automotive and specialty coatings businesses, as well as its marine and protective coatings and powder coatings units.
AkzoNobel said it rejected the proposal on May 1 and had also turned down an earlier approach made on April 22.
“Neither proposal qualified as a ‘potentially superior’ offer, compared to the Axalta merger,” a company spokesperson told Reuters.
The company reiterated that both its management board and supervisory board continue to unanimously support the planned merger with US coatings company Axalta Coating Systems.
Brokerage KBC also said AkzoNobel remained committed to the Axalta transaction.
“Akzo considers its own merger proposal with Axalta to be superior and pushes ahead on this track,” KBC analysts wrote in a note.
Axalta merger remains central strategy
AkzoNobel and Axalta announced their all-stock merger agreement in November, aiming to create a global coatings giant with a combined enterprise value of roughly $25 billion.
The merged entity is expected to be led by AkzoNobel Chief Executive Greg Poux-Guillaume and initially maintain dual listings in Amsterdam and New York.
The companies expect the transaction to close in late 2026 or early 2027.
AkzoNobel and Axalta have projected annual cost savings of approximately $600 million within three years of completing the merger, with around 90% of the synergies expected during that period.
The combined business would operate across more than 160 countries, significantly expanding its scale in industrial, automotive and decorative coatings markets.
Still, the Axalta merger has faced resistance from some shareholders since its announcement, amid questions over valuation and integration risks.
Activist pressure and industry consolidation
The takeover interest also comes against the backdrop of increasing consolidation pressure within the global coatings industry.
Last year, activist investor Cevian Capital disclosed a 5% stake in AkzoNobel and backed strategic changes at the company.
Cevian has historically pushed European companies toward mergers, breakups or acquisitions to unlock shareholder value.
However, CEO Greg Poux-Guillaume previously said Cevian was not involved in the decision to merge with Axalta.
Axalta itself has a substantial presence in industrial and automotive coatings markets.
The company generated around $5.3 billion in net sales in 2024, including strong contributions from refinish coatings, industrial coatings and vehicle OEM mobility coatings businesses.
AkzoNobel’s own performance coatings division, which spans automotive, marine, powder and industrial coatings applications, generated roughly €6.4 billion in third-party revenue last year.
The emergence of rival bidders highlights the strategic value of AkzoNobel’s assets at a time when coatings manufacturers are increasingly seeking scale, cost efficiencies and stronger global positioning amid uncertain economic conditions and fluctuating raw material costs.
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