2007 M&A Review
BY STEPHEN EINHORN & JACLYN CHRISTIANSEN
EINHORN ASSOCIATES
Last year was a good year for
merger/acquisition activity
in the paint industry with
approximately two-dozen paint
transactions in the U.S. alone. The
size of these transactions ranged
from million dollar small management buyouts to multi-billion dollar investments by industry leaders. Heading the list of acquirers
was PPG, Sherwin-Williams and
Akzo Nobel.
PPG’s 2007 acquisition efforts included offers to purchase SigmaKalon and
Barloworld, as well as the acquisition of
Champion Coatings. The Champion
purchase fit in with PPG’s goal to
increase market share in transportation coatings where PPG has great
strength. Having worked on this deal
our observation is that PPG, like most
of the major firms, has developed substantial expertise in exercising its transition skills as proven by their ability to
maintain and expand this business
shortly after its acquisition.
In July, PPG offered to purchase
SigmaKalon Group from Bain Capital
for approximately $3 billion. SigmaKalon, an international producer of
architectural, industrial and marine
coatings, is a leading coatings supplier in
Europe, and fit in with PPG’s geographic
and market goals. It gives PPG a significant presence in the European architectural coatings market and strengthens
PPG’s presence in pro¬tective and
marine coatings. In July, PPG agreed to
acquire Barloworld Coatings Australia, a
leading Australian architectural paint
producer. This purchase includes the
Bristol and White Knight brand names,
Last year Akzo Nobel agreed to acquire ICI for $16.7 billion, and this transaction became
official in January 2008. Pictured above from left to right is ICI CEO John McAdam and
Akzo Nobel CEO Hans Wijers.
complements PPG’s 2006 acquisition of
Protec and makes PPG the largest coatings manufacturer in Australia.
Sherwin-Williams made two significant acquisitions during 2007. The
purchase of MA Bruder included
approximately $150 million in sales
of architectural coatings through
company stores to contractors and
DIY markets. Sherwin-Williams’
merger agreement with Columbia
Paint & Coatings gives the company
additional market penetration in the
northwest U.S.
Akzo Nobel acquired Ceilcote and
Chemcraft in 2007. The Chemcraft
acquisition strengthens Akzo’s position
in the North American wood coatings
market and complements Akzo’s industrial finishes business. Akzo Nobel
strengthened its position in the protective coatings market with the acquisition of Ceilcote, which services the
power generation, mining, wastewater
and chemical processing industries.
Last year Akzo Nobel agreed to acquire
ICI for $16.7 billion, and this transaction became official in January 2008.
During 2007 the Finnaren & Haley
business was sold in three segments.
RPM’s Carboline subsidiary acquired
the marine and industrial paint segments while Benjamin Moore acquired
select stores and the specialty industrial
coatings were sold to a separate buyer.
Federated Paint was also sold in
segments. Delta Coatings acquired
Federated Paint and Midwest
Lacquer (a manufacturer of liquid
coatings and lacquers) and a manage-
