PPG drops bid to buy Dulux owner AkzoNobel

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US paints firm PPG has dropped a proposal to buy the Dulux-owner AkzoNobel after the Dutch firm spurned several informal offers.

PPG boss Michael McGarry said it had made a final offer for Akzo last week, but the firm did not respond.

“As a result, we believe it is in the best interests of PPG and its shareholders to withdraw our proposal to AkzoNobel at this time,” he said.

In April, PPG offered to pay 26.9bn euros (£22.8bn) for Akzo.

This had improved on two previous bids, but Akzo again rejected it, saying it undervalued the firm.

It also accused PPG of a “lack of cultural understanding of the brand” and said its own plans for growth better served shareholders.

In a statement on Thursday, PPG said it had promised additional commitments, including a significant break-fee, as part of its final offer.

It said it still believed a combined company would “create more opportunities” for customers, employees and shareholders.

Under Dutch securities rules, PPG may not approach Akzo again during a six-month cooling-off period.

AkzoNobel shares fell sharply on the news before regaining ground to trade 0.46% lower.

Many of Akzo’s largest shareholders supported a tie-up, although investors were said to have been expecting Thursday’s decision, given Akzo Nobel’s fierce opposition.

In April, Akzo put forward an alternative plan to the merger, promising to give shareholders 1.6bn euros in extra dividends.

It also said it would spin off its chemicals subsidiary, which represents a third of company sales and profits.

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