AkzoNobel, Axalta To Merge In USD 25 Billion Coatings Deal

20 Nov 2025 CW Team

Paint manufacturers have been consolidating to cut costs amid rising input prices, intense competition and uncertainty fuelled by past U.S. tariff policies. Poux-Guillaume said the merger would enable the combined business to deliver cost reductions that will strengthen profitability. He noted that the company will have a higher-margin product portfolio than BASF’s coatings business, in which private equity firm Carlyle acquired a majority stake in October. Most of the value creation, he added, will come from cost efficiencies rather than relying on an increase in demand.

“If you look at Axalta, what really stands out is that they’re very profitable,” he said. “If you take the combined profitability of the two businesses, including the synergies, you’re talking best in the market.”

AkzoNobel shares were flat at 1111 GMT after earlier falling as much as 3.7 per cent, while Axalta shares were 2.5 per cent lower, reversing an initial 2.7 per cent rise. Poux-Guillaume said the new group is expected to generate a 20 per cent core profit margin, compared with AkzoNobel’s 15.1 per cent margin in the third quarter and 13.8 per cent in 2024.

The merged company expects to deliver annual cost savings of USD 600 million, with 90 per cent achieved within the first three years after completion. The joint business is valued at eight times annual earnings, compared with the 12 times earnings valuation for BASF’s divested coatings unit.

The combined entity anticipates annual revenues of nearly USD 17 billion, adjusted core earnings of USD 3.3 billion, and USD 1.5 billion in adjusted free cash flow.

Under the merger terms, AkzoNobel shareholders will receive a USD 2.5 billion dividend payout and are expected to hold 55 per cent of the new company, with Axalta investors owning 45 per cent.

The deal is expected to close between late 2026 and early 2027.

Dulux paint maker AkzoNobel announced on Tuesday that it plans to merge with Axalta Coating Systems in a deal that will create a combined company with an enterprise value of USD 25 billion. The merged entity will initially be dual-listed in Amsterdam and New York before transitioning to a single NYSE listing, and will maintain dual headquarters in Amsterdam and Philadelphia. AkzoNobel chief executive Greg Poux-Guillaume will lead the company as CEO. Paint manufacturers have been consolidating to cut costs amid rising input prices, intense competition and uncertainty fuelled by past U.S. tariff policies. Poux-Guillaume said the merger would enable the combined business to deliver cost reductions that will strengthen profitability. He noted that the company will have a higher-margin product portfolio than BASF’s coatings business, in which private equity firm Carlyle acquired a majority stake in October. Most of the value creation, he added, will come from cost efficiencies rather than relying on an increase in demand. “If you look at Axalta, what really stands out is that they’re very profitable,” he said. “If you take the combined profitability of the two businesses, including the synergies, you’re talking best in the market.” AkzoNobel shares were flat at 1111 GMT after earlier falling as much as 3.7 per cent, while Axalta shares were 2.5 per cent lower, reversing an initial 2.7 per cent rise. Poux-Guillaume said the new group is expected to generate a 20 per cent core profit margin, compared with AkzoNobel’s 15.1 per cent margin in the third quarter and 13.8 per cent in 2024. The merged company expects to deliver annual cost savings of USD 600 million, with 90 per cent achieved within the first three years after completion. The joint business is valued at eight times annual earnings, compared with the 12 times earnings valuation for BASF’s divested coatings unit. The combined entity anticipates annual revenues of nearly USD 17 billion, adjusted core earnings of USD 3.3 billion, and USD 1.5 billion in adjusted free cash flow. Under the merger terms, AkzoNobel shareholders will receive a USD 2.5 billion dividend payout and are expected to hold 55 per cent of the new company, with Axalta investors owning 45 per cent. The deal is expected to close between late 2026 and early 2027.

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