JSW strengthens India paints push with $1.6 billion Akzo Nobel unit deal
BENGALURU: JSW Paints will buy Dutch paint maker Akzo Nobel's Indian arm for about $1.6 billion, in what will be the country's biggest deal yet in the sector as competition intensifies between established players and new entrants.
The deal comes as challenges for Indian paint makers mount, including volatile raw material costs and heightened competition, with billionaire Kumar Mangalam Birla's entry into the sector last year eating into Asian Paints' market share.
Dulux Paint-owner Akzo Nobel had announced a review of its South Asia operations last year to rein in costs and boost its core coatings business.
Shares of Akzo Nobel India jumped more than 11% after the deal was announced, and were trading 7.6% higher in Mumbai at around 0830 GMT.
India's paint and coatings market is expected to reach $16.37 billion in size by 2030, Mordor Intelligence estimates, from $10.46 billion in 2025, driven by a boom in infrastructure and real estate development.
The deal, which includes debt, will be the Indian paint sector's biggest deal on record, Dealogic data showed.
JSW Paints, launched in 2019 and part of the $23 billion JSW Group, will buy a 74.76% stake in Akzo Nobel India for $1.05 billion and launch an open offer for the roughly 25% held by public shareholders.
JSW Steel files review petition before India's top court on Bhushan Power deal collapse
Parent Akzo Nobel, the fourth-largest paint maker in the world by market capitalisation behind PPG, Nippon Paint and Sherwin-Williams, will continue to retain its research and development centre and powder coatings business in India.
Growing competition
Once completed, the deal will propel JSW Paints to fourth place by market share in a sector dominated by Asian Paints , Berger Paints and Kansai Nerolac, according to Geojit Financial Services analyst Antu Thomas.
Birla-owned Grasim launched Birla Opus in 2024, crowding the already-competitive market. Birla has since filed an antitrust complaint against Asian Paints for allegedly abusing its market position, Reuters has reported.
In 2022, the competition regulator closed a case filed by JSW Paints against Asian Paints for abusing its market position, saying it found no breach of competition laws.
'While this acquisition offers JSW Paints a significant scale-up opportunity, near-term integration challenges could provide an opportunity for incumbent players to strengthen their market position in the luxury segment,' Amit Purohit, vice president at Elara Capital said.
Akzo Nobel is likely to rake in 900 million euros in net proceeds and plans to launch a 400 million euro share buyback program after the deal's closing, which is expected in the fourth quarter of 2025.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
an hour ago
- Business Recorder
Indian rupee posts best week in over two years as dollar's struggles resurface
MUMBAI: The Indian rupee had its best week since January 2023, as an Iran-Israel ceasefire cooled oil prices and sapped safe-haven dollar demand, while worries over the Federal Reserve's future independence added pressure on the greenback. The rupee gained 1.3% on the week, its best performance in two and a half years, to close at 85.4750 per US dollar on Friday. Crude oil prices retreated by over 11% this week after Iran and Israel reached a ceasefire following a 12-day war, which saw involvement of the US Meanwhile, the dollar index was down 1.5% on the week as investors, unnerved by fresh signs of an erosion in US central bank independence, wasted no time in pushing the greenback back to its lowest levels in over three years. Trump's Fed backlash undermines dollar, primes Indian rupee for higher open 'Part of the sell-off of the dollar is due to the unpredictability of policy from Washington and that is unlikely to change,' MUFG Bank said in a note. The rupee rose this week but it continues to lag behind its Asian peers amid persistent dollar weakness seen over 2025. While currencies like the Korean won and offshore Chinese yuan are up between 2% and 9% this year so far, the rupee is little changed. Bankers and analysts reckon that while the rupee's underperformance is likely to persist, a broadly weaker dollar alongside portfolio inflows should support the currency in the near term. Foreign investors have turned buyers on Indian government bonds over the last few sessions, while block trades and initial public offerings have drawn interest from global investors. Later on Friday, the focus will be on US personal consumption expenditure (PCE) inflation data alongside remarks from Fed policymakers as investors try to gauge the future trajectory of the central bank's policy rates.
Business Recorder
2 hours ago
- Business Recorder
Safe-haven gold near a one-month low as global tensions ebb
Gold fell more than 1% to its lowest level in nearly a month on Friday due to easing geopolitical and trade tensions and as investors awaited US inflation data for clues on the future trajectory of interest rates. Spot gold lost 1.4% to $3,282.68 per ounce by 1055 GMT, its lowest since late May. Prices have fallen by over 2% this week and more than $200 from a record high scaled in April. US gold futures fell 1.6% to $3,294.50. The Iran-Israel ceasefire, brokered earlier this week by US President Donald Trump, is holding for now. A White House official said on Thursday that the US has reached an agreement with China on how to expedite rare earths shipments to the US July 9 is the deadline for Trump's 'reciprocal' tariffs as nations rush to get an agreement. 'The loss of haven demand has meant that despite the latest leg down in the dollar, gold has not benefited from this at all,' said Fawad Razaqzada, market analyst at City Index and 'A bit of a pullback would not be too bad an outcome as that will allow long-term technical overbought conditions on higher time frames to work off, allowing the metal to shine again when macro conditions are more favourable once more.' The immediate focus is the US Personal Consumption Expenditure data, an inflation gauge, scheduled for release at 1230 GMT. Fed Bank of Richmond President Thomas Barkin said tariffs are very likely to push inflation up over the coming months. Gold slips on easing ME tensions, Fed rate cut uncertainty Despite its reputation as a hedge against inflation and uncertainty, zero-yield bullion loses appeal in a high interest rate environment. Spot silver fell 1.8% to $35.96. Platinum dropped 5.9% to $1,334.63, after hitting its highest since 2014. Palladium fell 1.2% to $1,117.96. The main reason for the price increase in platinum was likely to be the high discount to gold, which is apparently considered too expensive, said Commerzbank in a note.
Business Recorder
2 hours ago
- Business Recorder
Oil set for steepest weekly decline in two years as risk subsides
LONDON: Oil prices rose on Friday though were set for their steepest weekly decline since March 2023, as the absence of significant supply disruption from the Iran-Israel conflict saw any risk premium evaporate. Brent crude futures rose 50 cents, or 0.7%, to $68.23 a barrel by 1036 GMT while US West Texas Intermediate crude gained 49 cents, or nearly 0.8%, to $65.73. During the 12-day war that started after Israel targeted Iran's nuclear facilities on June 13, Brent prices rose briefly to above $80 a barrel before slumping to $67 a barrel after US President Donald Trump announced an Iran-Israel ceasefire. That put both contracts on course for a weekly fall of about 12%. 'The market has almost entirely shrugged off the geopolitical risk premiums from almost a week ago as we return to a fundamentals-driven market,' said Rystad analyst Janiv Shah. Oil climbs as investors shift focus to demand signals 'The market also has to keep eyes on the OPEC+ meeting – we do expect room for one more month of an accelerated unwinding basis balances and structure, but the key question is how strong the summer demand indicators are showing up to be.' The OPEC+ members will meet on July 6 to decide on August production levels. Prices were also being supported by multiple oil inventory reports that showed strong draws in the middle distillates, said Tamas Varga, a PVM Oil Associates analyst. Data from the US Energy Information Administration on Wednesday showed crude oil and fuel inventories fell a week earlier, with refining activity and demand rising. Meanwhile, data on Thursday showed that the independently held gasoil stocks at the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub fell to their lowest in over a year, while Singapore's middle distillates inventories declined as net exports climbed week on week. Additionally, China's Iranian oil imports surged in June as shipments accelerated before the conflict and demand from independent refineries improved, analysts said. China is the world's top oil importer and biggest buyer of Iranian crude. It bought more than 1.8 million barrels per day (bpd) of Iranian crude from June 1-20, according to ship-tracker Vortexa, a record high based on the firm's data.
