Dutch paints maker Akzo Nobel reportedly is in talks to merge with smaller U.S. rival Axalta Coating Systems, to create a paints and coatings giant worth around $30 billion.

Bottom line: This looks like a high-priced case of offense being the best defense, as Akzo Nobel earlier this year rebuffed repeated takeover offers from Pittsburgh-based PPG Industries.

Related: Akzo Nobel continues the sale process for its specialty chemicals business, with first-round bids expected by year-end. It's unclear how that prospective deal – which has drawn strong private equity interest – will be impacted by last week's collapse of the Clariant/Huntsman Corp. merger due to activist investor opposition.

Analyst view from ING's Stijn Demeester:

"Strategically, the two companies make a good fit and a merger would likely create synergies, especially in terms of buying power. Moreover, an acquisition would make Akzo undigestable for PPG and thus make Axalta the ideal poison pill. However, we see hurdles in terms of valuation as Axalta shareholders would require a more than fair share of the combined group, reflecting the higher valuation/margin Axalta is currently bearing. We would expect a negative share price reaction today because of the execution risk and the reduced PPG optionality."

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