Key Takeaways:
AkzoNobel shares plunged 19% Wednesday after Sherwin-Williams and Nippon Paint Holdings abandoned their €12.49 billion joint bid for the Dutch paint maker.
The decision follows AkzoNobel's rejection of two joint all-cash offers, the companies said in a statement.
AkzoNobel shares fell to €53.74 in early Amsterdam trading, erasing gains from last week when news of the takeover approach emerged. The drop represents the stock's worst one-day percentage decline on record, according to FactSet data. The shares are now down about 9% year to date.
AkzoNobel continues to recommend a merger of equals with U.S. peer Axalta Coating Systems as an alternative path. The collapse of the $14.53 billion pursuit leaves the company as a standalone entity without the takeover premium investors had priced in.
The joint bid from Sherwin-Williams, the largest U.S. paint company, and Japan's Nippon Paint would have created a global coatings giant with combined annual revenue exceeding $40 billion. AkzoNobel, the maker of Dulux paints, rejected both all-cash proposals without engaging in negotiations, the suitors said.
The withdrawal marks the end of a brief but dramatic pursuit that had lifted AkzoNobel's shares 22% last week. Sherwin-Williams and Nippon Paint said they had decided to end their pursuit after the rejections, declining to make a hostile offer.
For AkzoNobel, the failed bid raises questions about its standalone strategy. The company's recommended merger with Axalta, a U.S. coatings firm with a market value of about $8 billion, would create a combined entity with significant North American exposure. Axalta shares were little changed in premarket trading Wednesday.
This article is for informational purposes only and does not constitute investment advice.
