PPG drops bid to acquire Akzo

U.S.based paint manufacturer PPG Industries has confirmed that it will not be launching a formal bid for Dulux owner Akzo Nobel, after three separate informal offers were refused by their Dutch competitor. Michael McGarry CEO of PPG said the company made a final approach to Akzo last week, but they did not receive a response.

Read - PPG may walk away from Akzo deal

"As a result, we believe it is in the best interests of PPG and its shareholders to withdraw our proposal to AkzoNobel at this time," McGarry said.

Dutch stock market rules mean that PPG will not be able to approach Akzo again until after a six month cool-off period. Reaction to the decision was limited, as investors had already priced in the decision, based on Akzo's fierce opposition to a deal.

It was originally in April, that PPG first proposed the takeover deal, at that point valuing Akzo at €26.3 billion or €95 euros per share.

Read - PPG increases offer for Dulux owner Akzo

On Monday a group of Akzo shareholders led by hedge fund Elliott Advisors lost a high profile bid in court to try to force Akzo's boards to engage in talks with PPG.

Throughout the process, Akzo argued a PPG takeover would be bad for employees, that the companies' cultures would clash and that Akzo should stay Dutch in the country's national interest.

In April, Akzo presented a case for remaining independent, offering their shareholders €1.6 billion in additional dividends and detailing plans to sell or float its chemicals subsidiary, which accounts for a third of their sales and profits.

Source: Insight Team

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