Dutch paints, coatings and chemicals group AkzoNobel NV (AMS:AKZA) on Friday said it would sell its decorative paints business in North America to US sector player PPG Industries Inc (NYSE:PPG) in a deal worth USD1.05bn (EUR801.1m).
Following a successful four-year turnaround, AkzoNobel decided to shed the Decorative Paints North America unit, in line with strategy to focus on key European markets and its solid positions in growth regions, it said.
For its part, the buyer sees the acquisition to continue its rapid portfolio transformation strategy via growth of its coatings operations, PPG chairman and CEO Charles E Bunch noted. The move also increases the company’s scale in the paint market in North America, the CEO added.
The business to be divested had revenues of USD1.5bn last year, 5,000 employees and eight manufacturing sites. Its portfolio includes brands such as Glidden in the US and Sico in Canada. The vendor will use the USD875m cash proceeds from the sale to finance organic growth and reduce net debt, it said.
AkzoNobel is still present in North America through its Performance Coatings and Specialty Chemicals businesses, which combined sales of more than USD2.7bn and nearly 5,000 employees in 2011.