AkzoNobel is to significantly boost its presence in the Chinese automotive market after agreeing to acquire Changzhou Prime Automotive Paint. Financial details were not disclosed.

Prime is one of China's largest vehicle refinish suppliers and a leader in the fast-growing mid-market segment. This sector is estimated to double in size within the next five years. Based in Jiangsu Province, the company develops, manufactures, markets and distributes automotive coatings, primarily for the refinish market.

The agreement follows AkzoNobel CEO Hans Wijers' recent announcement at the World Expo in Shanghai that the company plans to double its revenue in China to $3 billion within five years.

"This is an excellent deal involving an extremely well run business which gives us strong representation in one of China's most promising growth segments," said AkzoNobel's board member responsible for performance coatings, Leif Darner. "Our global capability, combined with Prime's marketplace knowledge, products and technical know-how, creates an enviable strategic proposition and will allow us to significantly grow ahead of the market."

Through its car refinishes business, AkzoNobel is mainly active in China's premium and commercial vehicle refinish sector, represented by its Sikkens, Lesonal and Miluz brands. The Prime agreement now opens up an opportunity to become the clear market leader in the attractive vehicle refinish mid-market segment.

"I am very happy to have concluded such an exciting deal, which promises great things for the future," commented Prime chairman and chief executive officer, Mr Bao Yifan, who will retain a key role within the business. "With AkzoNobel's scale and expertise, we are ideally positioned to continue growing strongly and aim to capture further market share."

Keith Power, AkzoNobel's regional director for the car refinishes business in Asia added: "This is an important transaction which gives us access to superior products and new technologies - supported by strong brands and a loyal distributor base - enabling us to gain a competitive advantage in a market with sizeable potential where we previously had limited presence."