The paint sector is seeing big moves- Akzo Nobel has decided to completely exit India by selling its entire promoter stake in Akzo Nobel India to JSW Paints. The promoters and entities of Akzo Nobel N.V.—Imperial Chemical Industries and Akzo Nobel Coatings International B.V.—have agreed to transfer their full shareholding to JSW Paints as part of a large-scale acquisition deal on June 27.
Akzo Nobel-JSW Paints deal valued at Rs 8,986 crore
JSW Paints, part of the $23 billion JSW Group, announced on Friday that it has signed a Share Purchase Agreement (SPA) to acquire up to 74.76 per cent stake in Akzo Nobel India. The total deal is valued at Rs 8,986 crore (about $1.05 billion), with an additional contingent payout of Rs 447 crore, depending on post-closing terms.
Akzo Nobel signs Standstill agreement with JSW Paints
Ahead of the transaction’s completion, Akzo Nobel India has signed a Standstill Undertaking with JSW Paints. This interim agreement sets certain conditions to maintain operational and financial stability until the deal closes. “The standstill undertaking includes interim covenants to make sure there are no material changes in the company’s ongoing operations or capital structure without the acquirer’s prior approval,” the company said in a regulatory filing.
No special rights granted to JSW Paints
As per the terms of the standstill agreement, Akzo Nobel India is barred from making major changes—such as altering capital structure, approving large expenditures, entering into significant related-party transactions, or initiating legal proceedings—without JSW Paints’ written consent. However, the agreement does not give JSW Paints any special rights, such as nominating directors or subscribing to fresh shares.
Not a related party deal
Akzo Nobel India clarified that it holds no stake in JSW Paints and that both companies are unrelated. Therefore, the transaction does not qualify as a related-party deal and is being executed at arm’s length. There are no board changes or share issuances involved at this stage.
JSW Paints plans to acquire additional 25% stake of Azko Nobel India
JSW Paints is also launching an open offer to acquire an additional 25.24 per cent stake in Akzo Nobel India from public shareholders. The open offer is valued at Rs 3,929.06 crore and will be made in cash.
The company has fixed an offer price of Rs 3,417.77 per equity share. If fully subscribed, the open offer will result in the acquisition of over 1.14 crore shares from public investors.
JSW Paints is joined in this open offer by JTPM Metal Traders and JSW EduInfra Private, both acting as Persons Acting in Concert (PACs). Together, they aim to ensure the total stake does not exceed 75 per cent, in line with SEBI’s regulations on public shareholding.
The combined stake from the SPA and open offer will strengthen JSW Paints’ position in India’s paints and coatings sector.