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WWW.DIYWEEK.NET Akzo fends off PPG takeover bid

Dulux parent Akzo Nobel announced it had been in conversation with US rival PPG International following its latest bid to buy the company, but has turned down the proposal because it still undervalues the company and could risk “thousands of jobs worldwide.” Having refused to engage in talks with PPG over two previous offers, Akzo Nobel revealed that it has declined a third unsolicited cash-and-stocks proposal worth €26.9 billion. The most recent offer, of €96.75 per Akzo Nobel share, was 8% more than the US company had proposed two days earlier on March 22, and 17% more than its opening bid,

which was made on March 2. PPG said it was extending “one last invitation” to Akzo Nobel to consider merging the two global companies. The Dulux parent company said its decision not to accept follows “considerable in-depth analysis” of PPG’s proposal by its supervisory board and management board. As part of the process, Akzo Nobel CEO Ton Büchner and supervisory board chairman Antony Burgmans met with PPG lead independent director Hugh Grant and chairman and CEO Michael McGarry on May 6 to discuss the offer. Whilst there was significant

pressure from some shareholders to consider PPG’s takeover bid,

Akzo assures investors its own strategy for independence – a plan to sell or float its speciality chemicals division – will be more financially beneficial.

The Dutch firm stated that the strategy contains fewer risks to the company and will create “a step change in value creation for shareholders and all other stakeholders.”

The plan is for a clear separation of specialty chemicals within 12 months, with the vast majority of net proceeds to be returned to shareholders. It also promises increased shareholder returns, including a 50% higher dividend for 2017 and €1 billion special cash dividend payable in November.

Akzo’s board listed a number of criticisms of PPG’s proposal, including its belief that the offer underestimates the current and future value of the company, and that the acquisition requires “significant and value-eroding disposals in order to achieve anti-trust approval.”

It also said that PPG had failed

to address concerns affecting employees, pensions, location of headquarters, and believes that the US company’s failure to provide any guarantees or adjust a projected minimum $750 million synergy target for the acquisition, “creates widespread anxiety and uncertainty for thousands of jobs” across the company, which boasts a 46,000-strong workforce.

Summarising that PPG’s

proposal is “not in the best interests of the company, its shareholders and all other stakeholders,” the report concluded with a statement from CEO Ton Büchner, who set out a commitment to Akzo’s independence strategy.

He said: “AkzoNobel has outlined a compelling strategy to accelerate growth and value creation, which we believe will deliver significant long-term value for our shareholders and all other stakeholders. We will deliver this within a clear timeline, without the substantial level of risks and uncertainties attached to the alternative proposal.” Read more on the story at

Hardware shop Rapid goes into administration

Liverpool’s Rapid Discount Outlet, which replaced Rapid Hardware back in 2013, has followed its predecessor into administration. Duff & Phelps has been appointed administrator, and has confirmed that the shop will continue to trade as the business goes up for sale. Established in 1971, Rapid

Hardware originally went into administration in 2013, just three years after moving from Renshaw

Street to Basnett Street. More than 100 staff lost their jobs, but the tale took an unexpected twist when original owners the Doherty family bought the business back and re-branded it as Rapid Discount Outlet. They pledged to re-hire many of the staff who had lost their jobs due to the administration. Duff & Phelps managing

directors Philip Duffy and Sarah Bell have been appointed joint administrators, saying in a

statement: “The administrators are reviewing the financial position of the business, with a view to continuing to trade to enable the business and assets to be sold.”

Though staff remain tight- lipped about details of the store’s administration, it is thought that the store’s city centre location has contributed to its demise, as customers are unable to park close by, preventing them from transporting bulkier goods.

Rapid Hardware was replaced by Rapid Discount Outlet four years ago



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