AkzoNobel shares plunge 19% after Nippon Paint and Sherwin-Williams withdraw buyout bid
The board’s rejection of a €73 per share offer in favour of a $25 billion merger with Axalta Coating Systems leaves the company facing a critical shareholder vote in July.
Dutch coatings manufacturer AkzoNobel suffered its worst single-day trading collapse in corporate history on Wednesday, with shares falling 19% to €53.74. The violent sell-off was triggered after Japanese firm Nippon Paint Holdings and US company The Sherwin-Williams Company permanently terminated their joint hostile takeover bid. The withdrawal leaves AkzoNobel facing a shareholder vote on its alternative $25 billion merger-of-equals agreement with US competitor Axalta Coating Systems in early July.
AkzoNobel’s board had previously rejected the consortium’s €73 per share cash offer, citing undervaluation and execution risks. The board argued that the bid failed to reflect the company’s intrinsic worth and warned that complex regulatory clearance and operational paralysis from asset separation would harm day-to-day operations. Instead, the board reaffirmed its commitment to the Axalta deal, which would see AkzoNobel equity holders retain a 55% controlling stake in the combined entity.
Under the mechanics of the proposed carve-up, Nippon Paint would have acquired AkzoNobel’s core decorative paints and industrial coatings operations, while Sherwin-Williams would have taken over automotive, marine, and powder coatings divisions. AkzoNobel’s management and supervisory boards flatly refused to engage with the non-binding approach last week, leading to the sudden end of the standoff on Wednesday morning.
Barclays analysts project the Axalta merger could unlock $600 million in annual cost savings, largely within the first three years. Bernstein estimates the Nippon-Sherwin alliance would have needed to offer at least €78 per share to force board compliance, but credit constraints prevented a higher bid. Moody’s had warned that pushing the price higher would have threatened Sherwin-Williams’ investment-grade rating, given the acquisition was slated to be funded through expensive, floating-rate debt.
AkzoNobel is scheduled to hold an extraordinary general meeting for a shareholder vote on the Axalta merger in early July. If approved, the combined entity will transition its primary listing to the New York Stock Exchange, with closing expected between late 2026 and early 2027. The rejection of the clean cash exit signals that AkzoNobel remains in play, with analysts noting the board’s gamble on long-term synergies over an immediate payout.
