JSW Paints Pursues CCI Approval for Acquisition of Akzo Nobel India
JSW Paints, under the leadership of Sajjan Jindal, has taken a significant step in the Indian paint industry by seeking approval from the Competition Commission of India (CCI) to acquire a majority stake in Akzo Nobel India. This ambitious move involves a total investment exceeding Rs 12,915 crore, which includes the purchase of a 74.76% stake in Akzo Nobel India for Rs 8,986 crore, along with an open offer to acquire an additional 25% from public shareholders for Rs 3,929.06 crore. If successful, this acquisition will position JSW Paints as the fourth-largest paint company in India.
Details of the Acquisition
JSW Paints aims to acquire up to 75% of Akzo Nobel India Ltd through a share purchase agreement and a mandatory open offer. The total investment of Rs 12,915 crore reflects JSW’s commitment to expanding its footprint in the paint sector, which it entered in 2019. The acquisition is expected to enhance JSW’s market presence significantly. Both companies have expressed confidence that the merger will not raise any competitive concerns in the relevant markets, indicating that market delineations can remain flexible.
Strategic Importance for JSW Group
JSW Group, a prominent Indian conglomerate with a diverse portfolio, including steel, cement, and energy, views this acquisition as a strategic move to strengthen its position in the paint industry. The group operates with a revenue of USD 23 billion and has been actively expanding its investments across various sectors. Akzo Nobel India, known for its decorative and industrial paint products, is affiliated with the Netherlands-based Akzo Nobel. This acquisition will not only broaden JSW’s product offerings but also enhance its operational capabilities in the paint market.
Background of Akzo Nobel India
Akzo Nobel India Ltd is recognized for its well-established brands, including Dulux, International, and Sikkens. In June, Akzo Nobel NV announced its decision to transfer its shareholding in Akzo Nobel India to the JSW Group. However, the Dutch parent company will retain full ownership of the India Powder Coatings business and the International Research Centre, which are currently part of Akzo Nobel India. This strategic review by Akzo Nobel NV aims to focus on strengthening its core coatings business while exploring various options for its South Asia portfolio.
Future Prospects and Growth
Parth Jindal, Managing Director of JSW Paints, highlighted the rapid growth of India’s paint sector and the swift expansion of JSW Paints. He expressed enthusiasm about integrating Akzo Nobel India’s renowned brands into the JSW family, aiming to build a future-oriented paint company. The acquisition is expected to bolster JSW’s market position and contribute to the overall growth of the Indian paint industry, which has shown promising potential in recent years. In FY25, Akzo Nobel India reported revenue from operations amounting to Rs 4,091.21 crore, underscoring the financial viability of this strategic move.
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