Investors urge Dulux owner to hold takeover talks

Dulux paint Image copyright AkzoNobel

Two large shareholders in Akzo Nobel have urged the Dulux paint owner to open talks on a potential takeover.

The call comes after the Dutch company rejected a second takeover offer from PPG Industries, saying an improved 22.4bn euro (£19.3bn) offer was still too low.

Elliot Advisors, which has a stake of more than 3%, told Akzo to "engage" with PPG.

Elliott said the revised offer price was a "credible basis for engagement".

It represented a premium of almost 40% to Akzo's share price before the first bid was announced.

Akzo said the new PPG proposal, made on 20 March, was worth 88.72 euros a share.

The previous rejected offer made on 9 March was worth 83 euros a share, valuing the company at almost £18bn.

Akzo shares fell 1.6% to 75.40 euros in Amsterdam following the rejection on Wednesday.


Another large shareholder in Akzo said it remained ambivalent about a deal, but that a slightly higher offer "could be tempting".

The investor, who did not want to be named, said: "We would believe it is up to management to convince us not to sell, as Akzo has been 'cheap' for a long time."

Image copyright Akzo Nobel

Dutch politicians had publicly opposed PPG's first proposal, saying it was not in the interests of the country.

On Monday, four provincial governors spoke out against an Akzo takeover, saying it would hurt Dutch jobs.

Akzo said the latest PPG proposal did not address its initial concerns, which included the valuation, risks that the deal might not be accepted by regulators, the leverage of the merged company, and job losses.

The company's board unanimously turned down the new offer, saying it did not warrant "engagement" with PPG.

Chief executive Ton Buechner said Akzo was "best placed to unlock value within the company ourselves".

The company said it would "provide updated financial guidance and hold an upcoming investor event soon".

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