Akzo Nobel (Amsterdam: AKZA) reportedly is in talks to merge with smaller U.S. rival Axalta Coating Systems (NYSE: AXTA), to create a paints and coatings giant worth around $30 billion.
- Why it's the BFD: Because this looks like a high-priced case of offense being the best defense, as Akzo Nobel earlier this year rebuffed repeated takeover offers from PPG Industries (NYSE: PPG).
- 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.
- Bottom line: "The U.S. coatings manufacturer is the 'ideal poison pill' that would make Akzo Nobel 'undigestable' for PPG, ING analyst Stijn Demeester said in a note, adding that any deal would have to overcome some hurdles in the companies' valuations. – Bloomberg
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