Kansai Paint Accuses South Africa's Freeworld of Obstructing Takeover Bid

Japan's Kansai Paint said on Friday the board of Freeworld Coatings is intent on obstructing its takeover bid, the latest salvo in deal that looks likely to go hostile.

Kansai also said it had secured an irrevocable agreement to accept the offer from South Africa's Stanlib Asset Management, giving it support from shareholders representing nearly 70% of the target shares.

Kansai in December bid 12 rand per share for the remaining 72.4% in the South African paint firm it did not already own.

Freeworld's board has repeatedly said the proposed 1.8 billion rand ($254 million) deal is likely to raise competition issues.

Freeworld last week released a circular to shareholders saying the looming February 18 deadline for the offer did not provide enough time for potential counter bidders and was unfair to shareholders.

"The Freeworld board seems intent on obstructing the acceptance of Kansai's offer by Freeworld's shareholders instead of using every endeavor to ensure that the offer proceeds to successful completion," Kansai said in a statement on Friday.

The Japanese company said Freeworld's arguments about competition and the offer timetable were "without foundation."

Kansai said fund manager Stanlib had agreed to sell its 5.24% stake in Freeworld, bringing shareholder support to 68.1% of the offer shares.

In addition, Stanlib agreed to recommend the offer to clients holding a 1.79% stake in Freeworld, Kansai said.