The Indian company JSW Paints has reached an agreement to acquire the Indian operations of the Dutch paint conglomerate Akzo Nobel, the parent company of brands such as Flexa and Sikkens. The acquisition, with a total value of $1.6 billion including debt, is the largest deal ever in the Indian paint industry.
Upon completion of the transaction, JSW Paints will become the fourth largest player in the Indian market, measured by market share. The acquisition includes a 74.76% stake in Akzo Nobel India for $1.05 billion. For the remaining public interest of approximately 25%, JSW will make a mandatory public offer.
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Strategic Restructuring
Last year, Akzo Nobel, owner of the Dulux brand among others, announced its intention to review its activities in South Asia to control costs and focus more on its core activities in coatings. Although the company is selling its majority stake, it will retain its R&D center and powder coatings activities in India.
As a result of the announcement, shares of Akzo Nobel India rose by more than 11%. The final proceeds from the deal for the parent company amount to approximately 900 million euros, allowing Akzo to finance, among other things, a share buyback.
Growth and Competition
The Indian paints and coatings market is growing rapidly, driven in part by increasing demand from the infrastructure and real estate sectors. According to estimates by Mordor Intelligence, the market will grow from $10.46 billion in 2025 to $16.37 billion in 2030.
However, competition in the market is increasing. Besides established names like Asian Paints, Berger Paints, and Kansai Nerolac, billionaire Kumar Mangalam Birla's conglomerate entered the market last year with its brand Birla Opus. Birla has since filed an antitrust complaint against market leader Asian Paints for alleged abuse of market power.
With this strategic acquisition, JSW Paints, founded in 2019 as part of the $23 billion JSW Group, strengthens its position in a dynamic and rapidly evolving sector.
More information:
Akzo Nobel
www.akzonobel.com