DuluxGroup to Acquire Cromology
DuluxGroup, the Australian subsidiary of Japan’s Nippon Paint Holdings, is to acquire European decorative paint maker Cromology, creating a combined entity that will be the leading paints & coatings company in Asia-Pacific and the fourth largest worldwide.
Cromology’s shareholder Wendel said it has entered into an exclusivity period with DuluxGroup to finalize the acquisition, which is expected to close during the first half of 2022. The purchase will be made through DGL International, a newly established UK-based subsidiary of DuluxGroup, which will fund the acquisition through existing cash and new debt facilities. Financial details were not disclosed.
Explaining its reasons for buying Cromology, Nippon Paint said it is “aggressively pursuing M&A activities by leveraging the high growth potential and stable cash flows of the paint market in order to firmly establish our sustainable growth and further increase our market presence around the world.”
According to the Osaka-based group, the European paints market is the second largest in the world behind China, and Cromology is the fourth-largest architectural paints manufacturer in Europe. Cromology is present in eight European countries and is expected to post full-year 2021 sales of about €686 million.
For Nippon Paint, the acquisition will mean improving scale across France, Spain, Italy and Portugal, as well as in other major European markets, including some in central Europe. Cromology will also provide the “right level of scale, volume and manufacturing capability” to form the entry point for Nippon Paint to build a decorative paints and coatings business in Europe and provide a platform for other bolt-on acquisitions.
Cromology’s network consists of 386 stories across France, Portugal and Switzerland, which will provide an opportunity to leverage DuluxGroup’s operational capabilities in running trade centers and selling to DIY customers in retail channels. It also presents an opportunity to launch other DuluxGroup brands in woodcare and texture coatings, and sealants, adhesives and fillers.
Author: Elaine Burridge, Freelance Journalist
