PPG ends quest to buy Akzo Nobel for at least six months

Gladys Abbott
June 1, 2017

USA paints and coatings maker PPG Industries (PPG.N) will not launch a formal bid for Dutch peer Akzo Nobel (AKZO.AS) after repeated informal offers were rejected, it said on Thursday.

PPG said it made the decision after the Pittsburgh-based company's last-ditch effort late last week failed to bring management of its Dutch rival to the bargaining table.

McGarry said AkzoNobel's boards did not respond to PPG's call or letter. "As a result, we believe it is in the best interests of PPG and its shareholders to withdraw our proposal to AkzoNobel at this time", he concluded.

The capitulation marks a setback in PPG's efforts to strengthen its global reach and allows it to offer customers a broader portfolio of paints and coatings.

PPG will not be making a fourth takeover offer for Dulux owner Akzo, the company said in a statement. Since the start of 2000, only about 16 percent of hostile takeovers in the Netherlands have been completed, according to data compiled by Bloomberg.

Akzo Nobel has held firm to its alternative plan to break into two companies focused on chemicals and coatings.

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PPG had proposed a takeover deal worth about 26.3 billion euros ($29.5 billion), or 95 euros per share.

PPG chairman and chief executive Michael McGarry did not appear to fully close the door on a future offer.

Under Dutch securities rules, PPG may not approach Akzo again during a six month cooling-off period. AkzoNobel's share price was down 1.5 per cent to €73.40 at the time of writing.

PPG Industries has withdrawn its offer for AkzoNobel after the Dulux owner rejected three bids from the United States chemicals manufacturer.

PPG will continue to look for growth opportunities that will increase the company's value, it said.

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