Key facts
- Nippon Paint and Sherwin-Williams terminated joint acquisition efforts for AkzoNobel.
- AkzoNobel rejected a €12.5 billion ($14.5 billion) cash takeover offer.
- AkzoNobel shares fell 19% following the announcement.
- AkzoNobel boards continue to recommend its planned merger with Axalta.
Nippon Paint and Sherwin-Williams announced on Wednesday, June 3, that they have terminated their joint efforts to acquire AkzoNobel. This decision follows AkzoNobel's rejection of their €12.5 billion ($14.5 billion) cash takeover offer last week. AkzoNobel shares fell 19% and were on track for their worst-ever trading day as of 11:05 GMT. Berenberg analyst Sebastian Bray suggested that the market may have anticipated another offer, but AkzoNobel stated that its boards unanimously continue to recommend its planned merger with U.S. coatings maker Axalta. Mergermarket's John West noted that AkzoNobel's board likely rejected the offers due to valuation, backing its own strategy to acquire Axalta. Bernstein analysts estimated that a successful offer would need to be above €78 per share, significantly higher than the €73 tabled. Moody's indicated that the rejected bid might have stressed Sherwin-Williams' investment-grade rating due to potential debt financing, and Bernstein analyst James Hooper commented on the leverage concerns for both Nippon Paint and Sherwin-Williams.