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PPG Industries Confirms Rejection of Offer by AkzoNobel
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PPG Industries (PPG - Free Report) has confirmed that it made an offer to Dutch paints maker, Akzo Nobel N.V. (AKZOY - Free Report) inviting the latter to enter into negotiations on a potential transaction to form a combined company. PPG confirmed that the proposal has been rejected by AkzoNobel.
AkzoNobel, on Mar 9, also confirmed that it received a proposal from PPG for a public offer on all of the issued and outstanding ordinary shares of AkzoNobel at a price of €54 in cash and 0.3 PPG shares for each AkzoNobel share, corresponding to a value of €83 per share (as of Feb 28, 2017).
AkzoNobel said that its management and supervisory boards have carefully reviewed and considered the proposal and unanimously concluded that it significantly undervalues AkzoNobel as it failed to reflect the long-term value creation potential of the company. The boards also believe that the offer is not in the interest of AkzoNobel’s stakeholders.
AkzoNobel also noted that it is reviewing strategic options for the separation of its specialty chemicals business. Separation of the specialty chemicals business, which had sales of €4.8 billion last year, will allow the business to continue to build and enhance its leading positions across a range of markets. The decision to spin off this unit came after the rejection of PPG’s bid.
PPG Industries, on the other hand, said that the combination of the companies is in the best interests of the shareholders of both companies and represents a compelling strategic opportunity. It would create an enhanced global player in paints, coatings and specialty materials leveraging complementary products, technologies and geographies, offering a vast range of products to a more diverse client base.
PPG Industries continues to believe there is a significant strategic rationale for the proposed transaction. The company has devoted significant time and resources to analyze a potential combination and will carefully assess and consider its position and path forward associated with this proposal. PPG Industries also remains confident in its ability to secure all necessary regulatory approvals and complete the proposed transaction.
PPG Industries, which is among the prominent U.S. paint makers along with Sherwin-Williams (SHW - Free Report) and Valspar (VAL - Free Report) , remains focused on expanding its business through acquisitions. The company, in 2013, purchased the North American architectural coatings business of AkzoNobel. The North American business, which markets the Glidden paint brand in the U.S., offered around 600 paint stores to PPG Industries. It also expanded the company’s scale in the North American architectural paint market.
PPG Industries, in 2014, also completed its purchase of leading Mexican paint company – Consorcio Comex S.A. de C.V. – for $2.3 billion. The buyout reinforces PPG’s architectural coatings business in Mexico and Central America by offering a leading architectural coatings portfolio.
The company, earlier this year, also purchased leading Romanian paint and architectural coatings maker, Deutek S.A. PPG Industries also purchased certain assets of automotive refinish coatings maker, Futian Xinshi in Jan 2017.
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PPG Industries Confirms Rejection of Offer by AkzoNobel
PPG Industries (PPG - Free Report) has confirmed that it made an offer to Dutch paints maker, Akzo Nobel N.V. (AKZOY - Free Report) inviting the latter to enter into negotiations on a potential transaction to form a combined company. PPG confirmed that the proposal has been rejected by AkzoNobel.
AkzoNobel, on Mar 9, also confirmed that it received a proposal from PPG for a public offer on all of the issued and outstanding ordinary shares of AkzoNobel at a price of €54 in cash and 0.3 PPG shares for each AkzoNobel share, corresponding to a value of €83 per share (as of Feb 28, 2017).
AkzoNobel said that its management and supervisory boards have carefully reviewed and considered the proposal and unanimously concluded that it significantly undervalues AkzoNobel as it failed to reflect the long-term value creation potential of the company. The boards also believe that the offer is not in the interest of AkzoNobel’s stakeholders.
AkzoNobel also noted that it is reviewing strategic options for the separation of its specialty chemicals business. Separation of the specialty chemicals business, which had sales of €4.8 billion last year, will allow the business to continue to build and enhance its leading positions across a range of markets. The decision to spin off this unit came after the rejection of PPG’s bid.
PPG Industries, on the other hand, said that the combination of the companies is in the best interests of the shareholders of both companies and represents a compelling strategic opportunity. It would create an enhanced global player in paints, coatings and specialty materials leveraging complementary products, technologies and geographies, offering a vast range of products to a more diverse client base.
PPG Industries continues to believe there is a significant strategic rationale for the proposed transaction. The company has devoted significant time and resources to analyze a potential combination and will carefully assess and consider its position and path forward associated with this proposal. PPG Industries also remains confident in its ability to secure all necessary regulatory approvals and complete the proposed transaction.
PPG Industries, which is among the prominent U.S. paint makers along with Sherwin-Williams (SHW - Free Report) and Valspar (VAL - Free Report) , remains focused on expanding its business through acquisitions. The company, in 2013, purchased the North American architectural coatings business of AkzoNobel. The North American business, which markets the Glidden paint brand in the U.S., offered around 600 paint stores to PPG Industries. It also expanded the company’s scale in the North American architectural paint market.
PPG Industries, in 2014, also completed its purchase of leading Mexican paint company – Consorcio Comex S.A. de C.V. – for $2.3 billion. The buyout reinforces PPG’s architectural coatings business in Mexico and Central America by offering a leading architectural coatings portfolio.
The company, earlier this year, also purchased leading Romanian paint and architectural coatings maker, Deutek S.A. PPG Industries also purchased certain assets of automotive refinish coatings maker, Futian Xinshi in Jan 2017.
5 Trades Could Profit "Big-League" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>