AkzoNobel (AKZOY) said overnight that it rejected an “unsolicited, non-binding and conditional proposal” from PPG Industries (PPG) for all of the issued and outstanding ordinary shares in the capital of AkzoNobel. PPG’s proposal “substantially undervalues AkzoNobel and is not in the interest of its stakeholders, including its shareholders, customers and employees,” the company said.

AkzoNobel confirmed that it received a proposal from PPG for a public offer on all of the issued and outstanding ordinary shares in the capital of AkzoNobel at a price of EUR 54 in cash and 0.3 PPG shares per AkzoNobel share, corresponding to a value of EUR 83 per share as per share as of February 28. AkzoNobel added, “The Boards have unanimously concluded that the PPG proposal substantially undervalues AkzoNobel by failing to reflect the long-term value creation potential of the company.

The Boards have also concluded that the equity component of the proposal has significant issues, including the high leverage of the proposed combination. They also believe the proposal carries significant delivery and timing risk for shareholders, both in relation to substantial anti-trust issues, pension schemes and the achievability of proposed synergies…AkzoNobel did not initiate nor has it encouraged or entertained any conversations with PPG on this matter.”


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