Akzo Nobel India Jumps 5.5% as JSW Paints Acquires 74.76% Stake; Open Offer at 16% Discount

Mumbai, June 27: Shares of Akzo Nobel India Ltd (NSE: AKZOINDIA) rallied 5.53% on Friday after its current promoters, Imperial Chemical Industries Ltd and Akzo Nobel Coatings International B.V., signed a definitive agreement, Share Purchase Agreement (SPA), to sell their entire stake (74.76% combined) to JSW Paints Ltd.

The deal marks a major consolidation move in India’s decorative paints sector, triggering a change in control of the company. As per SEBI regulations, the SPA has triggered an open offer to public shareholders.

As of 12:09 PM, Akzo Nobel India was trading at ₹3,456.40, up 8.37%. At the same time, JSW Paints’ unlisted valuation climbed 1.91% to ₹21,645.

JSW Paints to Acquire Controlling Stake

Under the Share Purchase Agreement (SPA) signed on June 27, 2025, the following holdings are being divested:

• Sale Price per Share: ₹2,762.05

• Implied Deal Size: Approx. ₹9,406 crore

• Post-Deal Promoter Cap: Up to 75% (subject to open offer acceptance)

Market Reaction

Akzo Nobel India’s stock reacted positively to the strategic shift:

Investors appear to be looking beyond the open offer price, which is expected to be at a 16% discount to the SPA rate, and are instead valuing the long-term potential of JSW’s entry.

Open Offer & SEBI Compliance

As per SEBI (SAST) Regulations, 2011, JSW Paints will launch a mandatory open offer for public shareholders:

• Relevant Regulation: Reg 3(1) & Reg 4 (Acquisition & Control)

• Maximum Holding Allowed: 75%

• Open Offer Price: Expected around ₹2,320 (16% discount to SPA)

The final holding of JSW will depend on the public shareholder response and is subject to Reg 7(4), which allows for proportionate promoter share adjustment.

Deal Approvals & Brand Transition

The transaction is subject to:

• Clearance from Competition Commission of India (CCI)

• Execution of brand licensing and IP agreements between Akzo Nobel N.V. and Akzo Nobel India

• Fulfilment of open offer and regulatory conditions

The company has signed a standstill undertaking with JSW Paints to preserve operations between the SPA signing and deal closure.

Strategic Implications

Upon deal completion, JSW Paints will be reclassified as the sole promoter, while current promoters will exit and be moved to the public category. This move follows Akzo Nobel N.V.’s South Asia portfolio review initiated in October 2024.

Outlook

The stake sale to JSW Paints signals a transformative shift in Akzo Nobel India’s ownership and market strategy. Despite a discounted open offer, investor sentiment remains upbeat, with expectations of long-term synergy gains and enhanced competitive positioning in the decorative paints sector.

About Akzo Nobel India

Akzo Nobel India Ltd, listed on NSE and BSE since June 28, 2001, is a prominent player in India’s paints industry with legacy brands like Dulux. It operates in both decorative and performance coatings segments.

With this acquisition, JSW Paints is poised to become a formidable challenger in India’s ₹70,000 crore paints industry, dominated by legacy players like Asian Paints and Berger Paints. The stock’s surge suggests investor optimism around strategic synergies and brand repositioning.

REF: https://nsearchives.nseindia.com/corporate/AKZOINDIA_27062025091149_AkzoNobelIndiaOutcome_of_Board_Meeting27June2025.pdf

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