Latest news with #JSWPaints
Time of India
26-05-2025
- Business
- Time of India
JSW Paints to acquire Akzo Nobel India stake for $1.1 billion
NEW DELHI: JSW Paints, led by Sajjan Jindal , is close to acquiring Akzo Nobel India, valuing the Dutch parent Akzo Nobel NV's 74.76% stake at around Rs 9,000 crore ($1.1 billion). This pegs the total valuation of the Indian unit between Rs 12,000-12,200 crore — a 25% discount to its current market price, as per the Economic Times report. If finalised, the acquisition will elevate JSW Paints to the fourth-largest player in India's decorative paints market and second in the industrial paints segment, significantly strengthening its presence. Akzo Nobel India's market capitalisation stands at Rs 16,380 crore, with its shares closing at Rs 3,582 on the BSE on May 23. The stock has gained 40% in the past year amid growing speculation of a stake sale. The acquisition will trigger an open offer for an additional 26% of Akzo Nobel India, based on regulatory norms and the average share price over the past 60 days. The company has about Rs 700 crore in cash, expected to be distributed to shareholders as dividends. JSW plans to fund the buyout with Rs 3,000 crore in promoter equity and another Rs 3,000 crore in bank financing, with lenders including Deutsche Bank, MUFG, and Axis Bank. The agreement is expected to be finalised by mid-June within a 30-day exclusivity window. The deal follows JSW's successful bid over a consortium of Advent International and Indigo Paints. If completed, it could also bring JSW Paints closer to achieving Rs 10,000 crore in annual revenue, setting the stage for a potential IPO. Akzo Nobel India, which has a 7% market share, offers a diverse range of products from decorative paints to industrial and marine coatings. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
26-05-2025
- Business
- Time of India
JSW poised to acquire Akzo Nobel India for $1.1 billion
JSW Paints is set to take over Akzo Nobel India , valuing parent Akzo Nobel NV's 74.76% stake at about Rs 9,000 crore ($1.1 billion), said people aware of the matter. This translates to a Rs 12,000-12,200 crore value for the Indian unit of the Dutch multinational, a 25% discount to the current market price, they said. The deal will take the acquirer to fourth position in the country's decorative paints market and number 2 in the industrial segment, giving it much-needed heft. Akzo Nobel India's market capitalisation is at Rs 16,380 crore, with the stock having closed at Rs 3,582 on Friday. The share has bucked industry trends, surging 40% in the past year in anticipation of a sale. Announcement of the transaction will trigger an open offer for another 26% of the company. This is based on the regulatory formula of the share price's weighted average in the past 60 days, after adjusting for Rs 700 crore cash on the books that will be given to shareholders as dividends. JSW won't exceed the 75% threshold. In the event that the entire open offer quota is tendered by public shareholders, it will buy that much less from Akzo Nobel NV. In that scenario, the Dutch parent won't exit its entire holding in one go and may gradually pare the stake through open market sales. It's estimated that JSW may end up spending Rs 9,000-9,500 crore on the transaction. The two sides are working toward finalising the share purchase agreement by mid-June, within the 30-day exclusivity period, said the people cited. ET reported on May 15 that they had entered into an exclusive agreement to hold negotiations as JSW trumped a competing bid by a consortium of Advent International and Indigo Paints. The JSW promoter family —led by group chairman Sajjan Jindal —is planning to put in Rs 3,000 crore as equity for the buyout, said the people cited. Another Rs 3,000 crore is being financed through banks such as Deutsche Bank, MUFG and Axis, among others. ET has earlier reported the group to be in discussions with the credit funds of KKR , Ares Capital and Goldman Sachs, among others, for funding. Interestingly, the plan is to keep privately owned JSW Paints and Akzo India as two separate businesses and not initiate a reverse merger between the two, according to the people familiar with the plan. Akzo and JSW Group declined to comment. Citi and Morgan Stanley are advisors to the deal. UNHAPPY HUE After announcing its decision to review business operations in the Indian subcontinent in October last year, Akzo India, in February, hived off and agreed to sell its powder coatings business— the unit's most profitable stream that contributes close to 12-14% of sales—to its Dutch parent. This had taken some of the sheen off the deal for contenders. The intense competition in the Indian paints industry and the resultant margin squeeze has also led to valuations getting impacted, according to analysts. FY25 was one of the worst years for the country's paint industry in nearly three decades, with business contracting. This came amid increased competition with the entry of the Aditya Birla Group's Birla Opus in February last year. At an industry level, demand fell 4-5% in FY25. Akzo, like most in the industry, has been bracing for sectoral headwinds. The company has about 7% market share in India and is one of the most profitable in the segment, with an annual production capacity of 250 million litres, focused on high-end decorative paints with its Dulux brand. It experienced low single-digit growth in value in the December quarter while profit was down 5%, partly due to a special dividend issued in the previous year. The automotive and vehicle refinish segments faced challenges, hitting overall performance. Akzo, one of the largest paint companies in the world, has been slashing jobs and production, intensifying concerns about the resilience of European industry, as the continent struggles with rising energy costs following Russia's invasion of Ukraine. JSW is looking for significant gains. It turned profitable at an operating level for the first time in FY24, with an operating margin of 3%. An Akzo buy will inch it closer to third-placed Kansai Nerolac in the decorative segment.
Time of India
26-05-2025
- Business
- Time of India
JSW poised to acquire Akzo Nobel India for $1.1 billion
Synopsis JSW Paints is poised to acquire Akzo Nobel India, valuing Akzo Nobel NV's stake at approximately Rs 9,000 crore. This acquisition will position JSW Paints as a significant player in both the decorative and industrial paints sectors in India. The deal, expected to finalize by mid-June, involves an open offer for an additional 26% of the company's shares.
Time of India
16-05-2025
- Business
- Time of India
JSW Paints Leads the Race for Akzo Nobel Prize
HighlightsJSW Paints has signed an exclusivity agreement to acquire Akzo Nobel India, surpassing the competing bid from a consortium of Advent International and Indigo Paints. If the acquisition is successful, JSW Paints will rise to the fourth position in the Indian decorative paints market and enhance its presence in the industrial paints sector. The acquisition deal, valued at approximately ₹11,854.63 crore ($1.39 billion), will trigger an open offer and is expected to help JSW Paints approach the ₹10,000 crore revenue mark, making it a candidate for a possible Initial Public Offering. JSW Paints has emerged as the frontrunner to acquire Akzo Nobel India , trumping the only competing bid from a consortium of Advent International and Indigo Paints, said people aware of the development. Ending weeks of intense negotiations, the two have signed an exclusivity agreement for negotiations to finalise terms and documentation for a share purchase agreement before making a formal announcement. If successful, this will catapult JSW to fourth position in India from lower down in the pecking order, inching closer to third-placed Kansai Nerolac in the decorative segment and putting it in No 2 slot in industrial paints space. It also will help JSW Paints inch closer to the `10,000 crore revenue mark, putting it in line for a possible IPO . Decorative paints account for 75 per cent of the total demand in the country, led by repainting and new construction. Asian Paints leads the segment, followed by Berger and Kansai Nerolac. Both bidders for Akzo Nobel India had submitted binding offers late last month, ET was first to report April 24. Deal may Trigger Open Offer | page 12 Hectic deliberations have been underway in the past few weeks, starting at a significant discount to the current market value , keeping in mind the fast-changing competitive landscape of the Indian paints business. The bid-ask gap is said to have shrunk significantly over this period. Akzo Nobel India's current market value is at ₹15,857.14 crore, the stock having closed Thursday at ₹3,482, down 25 per cent from its 52-week high of ₹4,649 on October 9. To be sure, it surged about 36 per cent in the past 12 months in anticipation of a sale. Parent AkzoNobel NV holds a 74.76 per cent stake as promoter and JSW's offer will trigger an open offer. JSW's offer is said to be at a 5-8 per cent discount to the market price, valuing the promoter stake at ₹11,854.63 crore ($1.39 billion). Privately held JSW Paints is expected to reverse merge with the listed Akzo Nobel India, according to the people cited. It's not yet clear if AkzoNobel will retain a small stake in the combined business. Citi and Morgan Stanley are advisors to the transaction. Sri Lanka operations For the moment, JSW is looking to buy the India operations with an understanding that it will eventually take over operations in Sri Lanka, where Akzo already has a local joint venture partner. Sajjan Jindal-led JSW has been in discussions with several global banks and financial institutions including Standard Chartered Bank, MUFG and Barclays for acquisition funding, said the people cited. It's also said to be in talks with Ares Capital, KKR, Goldman Sachs and Apollo Global Management for ₹4,000-4,500 crore of structured financing. Apollo is already an investor in the group's cement business. The financing consortium is yet to be finalised. The promoters, the Sajjan Jindal family, are expected to infuse ₹2,500-₹3,000 crore as equity. The deal size will depend on the success of the open offer. JSW was not available for comment. AkzoNobel NV declined to comment on market speculation. Emails sent to Ares Capital and Goldman Sachs didn't elicit a response till press time. KKR declined to comment. AkzoNobel had announced plans to review its business operations in the Indian subcontinent in October 2024. In February, Akzo Nobel India hived off and agreed to sell its powder coatings business — its most profitable stream that contributes 12-14 per cent of sales — to its Dutch parents. That took the shine off the deal for several potential suitors, industry executives said. JSW Paints hasn't been able to break into the decorative top three since it was set up six years ago. On the other hand, newcomer Birla Opus, from Grasim Industries, has managed to gain a 3-4 per cent market share in Q3 alone, said industry executives. Given that Akzo Nobel India's Dulux Paints is present in the luxury and uber-luxury category and in urban markets, a deal will give JSW Paints significant heft in the market.
Time of India
15-05-2025
- Business
- Time of India
JSW Paints set to add lustre with Akzo India buy
Mumbai: JSW Paints has emerged as the frontrunner to acquire Akzo Nobel India , trumping the only competing bid from a consortium of Advent International and Indigo Paints , said people aware of the development. Ending weeks of intense negotiations, the two have signed an exclusivity agreement for bilateral negotiations to finalise terms and documentation for a share purchase agreement before making a formal announcement. If successful, this will catapult JSW to fourth position in India from lower down in the pecking order, inching closer to third-placed Kansai Nerolac in the decorative segment and putting it in No. 2 in industrial paints . It also will help JSW Paints inch closer to the Rs 10,000 crore revenue mark, putting it in line for a possible IPO. Decorative paints account for 75% of the total demand in the country, led by repainting and new construction. Asian Paints leads the segment, followed by Berger and Kansai Nerolac. (Yes) although margins are shrinking owing to increased competition from new entrants such as Birla Opus. Both bidders for Akzo Nobel India had submitted binding offers late last month, ET was first to report April 24. Hectic deliberations have been underway in the past few weeks, starting at a significant discount to the current market value , keeping in mind the fast-changing competitive landscape of the Indian paints business. The bid-ask gap is said to have shrunk significantly over this period. Akzo Nobel India's current market value is at Rs 15,857.14 crore, the stock having closed Thursday at Rs 3,482, down 25% from its 52-week high of Rs 4,649 on October 9. To be sure, it surged about 36% in the past 12 months in anticipation of a sale, making it the most expensive paint stock in the world. Parent AkzoNobel NV holds a 74.76% stake as promoter and JSW's offer will trigger an open offer. JSW's offer is said to be at a 5-8% discount to the market price, valuing the promoter stake at Rs 11,854.63 crore ($1.39 billion). Privately held JSW Paints is expected to reverse merge with the listed Akzo Nobel India, according to the people cited. It's not yet clear if AkzoNobel will retain a small stake in the combined business. Citi and Morgan Stanley are advisors to the transaction. For the moment, JSW is looking to buy the India operations with an understanding that it will eventually take over operations in Sri Lanka, where Akzo already has a local joint venture partner. Sajjan Jindal-led JSW has been in discussions with several global banks and financial institutions including Standard Chartered Bank, MUFG and Barclays for acquisition funding, said the people cited. It's also said to be in talks with Ares Capital, KKR, Goldman Sachs and Apollo Global Management for Rs 4,000-4,500 crore of structured financing. Apollo is already an investor in the group's cement business. The financing consortium is yet to be finalised. The promoters, the Sajjan Jindal family, are expected to infuse Rs 2,500-3,000 crore as equity. The deal size will depend on the success of the open offer. JSW was not available for comment. AkzoNobel NV declined to comment on market speculation. Ares, Goldman Sachs XXXX. KKR declined to comment. AkzoNobel had announced plans to review its business operations in the Indian subcontinent in October 2024. In February, Akzo Nobel India hived off and agreed to sell its powder coatings business—its most profitable stream that contributes 12-14% of sales--to its Dutch parents. That took the shine off the deal for several potential suitors, industry executives said. JSW Paints hasn't been able to break into the decorative top three since it was set up six years ago. On the other hand, newcomer Birla Opus, from Grasim Industries , has managed to gain a 3-4% market share in the third quarter alone, said industry executives. Given that Akzo Nobel India's Dulux Paints is present in the luxury and uber-luxury category and in urban markets, a deal will give JSW Paints significant heft in the market. JSW Paints managing director Parth Jindal had described the Akzo Nobel India stake sale as an 'exciting opportunity' in January. 'There is no choice... I have to give everything I've got for Akzo Nobel India,' he had said at the time. Grasim, part of the Aditya Birla Group, marked one year of its paints operations in February. It's completed the construction of four plants and is looking to set up two more. It has invested Rs 9,000 crore so far in advertising and marketing besides capacity expansion and dealer incentives. An additional Rs 1,000 crore is earmarked for new plants and its eyeing a network of 50,000 dealers by the end of March. Paint company operating profitability margins, which shrank to 16% in H1FY25 from 20% in the year before, are expected to further contract to 14% by FY26, according to Care Ratings, after a sustained CAGR of 14-15% between FY19 and FY23. Earlier this week, ET had reported Reliance Industries Ltd's plan to divest its 5% holding in Asian Paints for over $1 billion. Akzo Nobel India, like most in the industry, has been bracing for sectoral headwinds. The company has about 7% market share in India and is one of the most profitable in the segment with an annual production capacity of 250 million litres, focused on high-end decorative paints. It has experienced low single-digit growth in value while profits in Q3FY25 were down by 5%, partly due to a special dividend issued in the previous year. But the automotive and vehicle refinish segments as well as the coil coating part of industrial paints faced challenges, impacting overall business performance.
