AkzoNobel has offered €31.25 per share, representing a total value of about €1.4 billion, beating an offer of €1.24 billion by rival US paints manufacturer PPG Industries.

PPG announced on Dec. 18 that it had entered into a definitive agreement to buy Tikkurila for roughly €1.1 billion, but revised its offer on Jan. 5 in response to AkzoNobel’s move.

Tikkurila said it will consider AkzoNobel’s offer and PPG’s potential response. Under the terms of the agreement between Tikkurila and PPG, the board of the Vantaa-based company can withdraw, amend or modify its recommendation for PPG’s offer, but must give the Pittsburgh-based firm five business days to negotiate and amend the terms and conditions.

Akzo Nobel said the due diligence had confirmed its view that the merger would create clear synergies from collective procurement capabilities, expanded production and combined sales and distribution channels, also creating significant opportunities for future growth.

As part of its proposal, the Amsterdam-headquartered group has already agreed key terms to sell its decorative paints business in the Nordics and Baltics to Denmark’s Hempel, in order to obtain regulatory approval.

Author: Ellaine Burridge, Freelance Journalist