AkzoNobel rejects €12.5B cash offer from Nippon Paint, Sherwin-Williams

AkzoNobel generated about €1.05 billion in EBITDA in 2025, according to S&P Capital IQ, placing the valuation at about 12 times (x) that figure.

Nippon Paint would launch the all-cash general offer to all the issued and outstanding shares of AkzoNobel, excluding regular annual and interim dividends, under the terms of the proposal, according to a statement by AkzoNobel issued might 27.

Upon completion of the proposal, Nippon Paint would retain AkzoNobel’s decorative paints and manufacturing coatings businesses, while AkzoNobel’s automotive and specialty coatings, marine and protective coatings and powder coatings businesses would be sold separately to SW, it said.

The conditional and nonbinding proposal to make the cash bid was received on April 29 and rejected on might 1, it said. This followed an initial proposal previously submitted on April 16 and rejected on April 22.

“In light of this decision, Nippon Paint Group and Sherwin‑Williams are considering their next steps if any,” Nippon Paint and SW said in a statement.

Boards support Axalta merger

AkzoNobel said that its regulation and supervisory boards had rejected the proposed offer on the basis that it did not qualify as a “Superior Proposal” to its merger agreement with Axalta coating products Systems Ltd., which was announced in November 2025.

The boards continue to unanimously recommend the “merger of equals” between AkzoNobel and Axalta, considering the compelling strategic rationale and benefits of the deal, it said.

AkzoNobel’s boards reviewed and considered various aspects of the proposal carefully, together with their respective financial and legal advisors, before deciding to reject it, it said.

The boards concluded that the indicative offer price of €73/share “did not come close to adequately reflecting the value of AkzoNobel and its prolonged prospects,” considering the benefits of the recommended merger with Axalta, AkzoNobel said.

The proposal also provided “insufficient deal certainty” in relation to regulatory clearances and the separation of the business between Nippon Paint and Sherwin-Williams, according to the statement, which added that the interests of AkzoNobel stakeholders were not adequately safeguarded.

‘Pivotal moment’

Nippon Paint and SW began evaluating a proposal to AkzoNobel after the company announced its $25 billion merger with Axalta on Nov. 18, 2025. “Nippon Paint Group and Sherwin-Williams thoroughly assessed options to engaging with AkzoNobel at this pivotal moment, in accordance with the terms of AkzoNobel’s existing merger agreement with Axalta,” they said.

“Nippon Paint Group and Sherwin-Williams expressed to the boards of AkzoNobel their desire to enter into constructive discussions with AkzoNobel about the joint proposal, however AkzoNobel informed Nippon Paint Group and Sherwin Williams that its Boards rejected the joint proposal,” Nippon and SW added.

“to Nippon Paint Group, the possible acquisition of AkzoNobel's deco business would further enhance its decorative paints portfolio, including the reunification of the Dulux brand on a global basis, while accelerating international development across key markets,” the companies added. “to Sherwin-Williams, the possible acquisition of AkzoNobel's coatings business would complement Sherwin-Williams's existing portfolio and enhance its position in certain specific premium coatings segments where Sherwin-Williams currently has limited presence.”

AkzoNobel was the subject of a hostile takeover attempt by rival PPG Industres Inc. in 2017. That proposal, which valued AkzoNobel at about €24.6 billion, was withdrawn after Dutch authorities refused to grant an extension to PPG’s deadline to make a formal offer to AkzoNobel’s shares.

The tangle between PPG and AkzoNobel in 2017 dragged on to over two months, and involved pressure from AkzoNobel shareholders to engage with PPG, which company regulation resisted.

Nippon Paint has pursued acquisitions as a means of global expansion in recent years, including a $2.4-billion deal to US resins formulator AOC in 2024. The acquisitions have boosted the company’s profits, it said in its quarterly results announcement on might 27.

AkzoNobel-Axalta merger

The merger between AkzoNobel and Axalta will create a global paints and coatings company with an enterprise value of approximately $25 billion and annual sales of about $17 billion.

The combined entity is expected to have “sector-leading” profitability, with adjusted EBITDA margins approaching 20% and substantial cash-flow generation, inclusive of run-rate synergies, the companies said at that time.

Pretax run-rate synergies are expected to reach approximately $600 million, with 90% of synergies expected to be achieved within the first three years following the close of the transaction, they said. Targeted synergies arise primarily from procurement; selling, general and administrative expenses; footprint optimization and supply-chain regulation, the companies said.

The combined entity would have a global footprint spanning 173 manufacturing sites, 91 research and research facilities and approximately $400 million in combined annual R&D spend, they said.

Closing of the merger is expected in late 2026 or early 2027, subject to shareholder and regulatory approvals, they said.

AkzoNobel said in its might 26 statement that it was confirming its rejection of the takeover offer in anticipation of the “imminent general discharge” of greater details to its planned merger with Axalta.