AKZONOBEL has confirmed it is in talks about merging its paints and coating business with Axalta Coating Systems.
AkzoNobel, the second largest paints and coatings company by sales, said it is currently in “constructive discussions” with Axalta, which is the world’s seventh largest. A tie up would create a company with a market value of around US$30bn.
The sale of AkzoNobel’s speciality chemicals business announced earlier this year is not affected by the talks and remains on track for completion in April, it confirmed.
AkzoNobel rejected three takeover attempts by PPG, the world’s largest paints and coatings firm, earlier this year. The move for Axalta has been described as a strategy of defending against takeover offers, analysts have said. Axalta’s vehicles coating business would fill a gap in AkzoNobels’s portfolio.
The Dutch paint maker confirmed a deal was possible following press speculation that talks were underway. Axalta issued its own statement confirming the talks, but added that no assurances can be made that a definitive agreement will be reached.
Axalta will seek to take advantage of an under-pressure AkzoNobel as negotiations continue, an analyst has told Reuters.
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