THE HAGUE: The world’s top paint and coatings maker AkzoNobel said Wednesday it had rejected a second unsolicited buyout offer from its US rival PPG Industries.
The Dutch firm said PPGI’s “proposal fails to recognise value of AkzoNobel and neglects to address significant risks and uncertainties, including extensive anti-trust concerns.”
It said the revised offer was 88.72 euros per AkzoNobel share, with 56.22 euros in cash and 0.331 PPG shares.
After rejecting a first offer from PPGI, which only just trails in annual sales, AkzoNobel indicated it would review the option for its specialty chemicals business which generated 4.8 billion euros in sales last year.
AkzoNobel said the PPGI offer not only undervalued the company, but didn’t take into account the opportunities for increasing shareholder value by a new strategic direction for the specialty chemicals business.
“We are convinced that AkzoNobel is best placed to unlock the value within our company ourselves,” said chief executive Ton Buechner.
AkzoNobel said merging the top two paint and coatings companies carried significant risks as regulators could block the deal due to anti-trust concerns and force divestitures that would erode the value of the deal for shareholders.
It warned a merger would also lead to significant job cuts.
PPGI bought AkzoNobel’s North American operations in 2013 for $1.05 billion, taking advantage of a restructuring by the Dutch company to boost its profitability.
Employing 46,000 people across 80 countries, AkzoNobel generates most of its revenues in Europe and Asia.
For PPGI, which counts 47,000 employees in 70 countries, the purchase of AkzoNobel would help it reduce its reliance on the North American market.