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Akzo Nobel India share price today: Share price of Akzo Nobel India rallied 10.6 per cent today, to an intraday high of ₹3,533 per sharfe on the BSE in Friday's trade, after the company's promoters executed a share purchase pact with JSW Paints to sell the company's decorative paint business.
As per the terms of the SPA, JSW Paints will buy 22,977,544 equity shares of Imperial Chemical Industries Limited (50.46 per cent) and 11,066,791 equity shares of Akzo Nobel Coatings International B.V. (24.30 per cent), takign the total buyout at 74.76 per cent.
The deal has been announced at a price of ₹2,762.05 per share, which is a 16 per cent discount to Akzo Nobel's share price on Thursday. Considering the price and the number of shares, the total value of the deal is worth ₹9,403.21 crore.
"Imperial Chemical and Akzo Nobel Coatings propose to sell up to their entire shareholding of 50.46 per cent and 24.30 per cent, respectively, in the company to JSW Paints. The exact quantum of shares sold will depend on the number of shares tendered by public shareholders under the mandatory open offer required to be made by the Acquirer," Akzo Nobel India said in its stock exchange filing.
According to reports, the first stake purchase is expected to be for the sum of ₹8,986 crore. Later, there will be certain contingent considerations, worth ₹447 crore, that may become payable going forward.
Rationale behind the sale of India paint business
On October 4, 2024, Akzo Nobel India said the company has received communication from Akzo Nobel NV (the Ultimate Holding Company of Akzo Nobel India) that AkzoNobel will begin a portfolio review with initial focus on Deco South Asia. AkzoNobel, it said, was conducting a strategic review of its portfolio in order to redeploy capital towards growing its core coatings businesses.
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The initial focus will be on its decorative paints positions in South Asia. AkzoNobel has a premium, highly profitable position in India, with a strong track record of growth. Given this unique market position, the company is well-placed to participate in the further development of the highly dynamic South Asian decorative paints market, which is ripe for consolidation, the company had said.
Open offer by JSW Paints
JSW Paints, together with JTPM Metal Traders Private Limited and JSW EduInfra Private Limited, announced an open offer for acquisition of up to 11.5 million shares, representing 25.24 per cent of the voting share capital of Akzo Nobel India, at a price of ₹ 3,417.77 per share.
ICICI Securities view on Akzo Nobel India
Fundamentally, Akzo Nobel has a paints capacity of ~250,000 Kl while JSW Paints has ~170,000 Kl capacity. Post the acquisition, JSW Paints would have a capacity of ~420,000 Kl capacity, which takes it to the 4th position in terms of capacity in India in decorative paints. By comparison, Asian Paints has a capacity of 18,50,000 Kl, Berger Paints 15,00,000 Kl, and Grasim 10,96,000 KI.
"This will continue to maintain the price competitiveness in the market as all players will compete to gain market share in the near to medium term. Hence, we believe the paint companies margins will remain under pressure in the near term," ICICI Securities said.
Q4 Result
In Q4 2024-25, Akzo Nobel India registered ahead-of-industry topline growth, driven by double-digit growth in B2B businesses. In retail, the business continued to grow in premium category and urban centers, while demand in mass and economy categories was impacted by competitive dynamics. Despite such a market environment, the management said the company sustained double-digit profitability and continued to grow market share.
About Akzo Noble India
Akzo Nobel India is engaged in the business of manufacturing, trading and selling of paints and related products. The Company also provides research and development services to its holding company i.e. Akzo Nobel NV and other group companies.
The company's wide range of sustainability driven innovations across paint products (Decorative and Coatings) brought alive by the strength of its iconic global brands, including Dulux, International, Sikkens and Interpon is protecting and beautifying homes, and infrastructural sectors that touch lives everyday – be it on water, land or air – power, shipping, oil and gas, steel, construction, consumer durables, packaged food and beverages and more.
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