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4/17, 6:09 AM (Source: TeleTrader)
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Nippon Paint set to acquire DuluxGroup for $2.7B

Japan's largest paint manufacturer Nippon Paint Holdings Co. Ltd. has offered to buy its largest Australian counterpart DuluxGroup for ¥300 billion ($2.68 billion), media reported on Wednesday.

The Japanese company tabled an offer of $9.80 Australian dollars ($7.02) per share in cash for the Australian company, including 15 Australian cents per share for the interim dividend that the latter intends to pay. The offer represents a premium of 28% on DuluxGroup's closing price on Tuesday. Nippon Paint said that it is looking to complete the transaction by mid-August. The offer has been backed by DuluxGroup's board of directors and will be voted on by its shareholders in July.

Nippon Paint is the seventh-largest paint manufacturer in the world and generates 60% of its Asian sales outside of Japan, mostly in China. However, it does not have any operations in Australia or New Zealand. DuluxGroup is the leading paint manufacturer in that region and had revenues of $1.3 billion in the year ending September 2018. Nippon Paint's offer gave it an implied enterprise value of $4.2 billion.

DuluxGroup's shares on the ASX surged 27.18% at 5:45 am CET to hit record highs following the news.

Breaking the News / DZ