JSW Paints Limited, in a significant corporate maneuver, has announced an open offer to acquire up to 26% of the voting share capital of Akzo Nobel India Limited. This move, made in concert with JTPM Metal Traders Limited and JSW EduInfra Private Limited, signals a potential shift in the Indian paints industry landscape.

Offer Details

The open offer targets the acquisition of up to 1,18,40,482 equity shares, representing 26% of Akzo Nobel India's voting share capital. Key details of the offer include:

Independent Directors' Recommendation

The Independent Directors Committee (IDC) of Akzo Nobel India has played a crucial role in this process:

• The IDC approved its recommendation on October 15
• The recommendation was published on October 17
• Publication mediums included Financial Express, Jansatta, Dainik Statesman, and Navshakti

IDC's Assessment

The IDC, after reviewing the offer documents, has concluded that the offer price of ₹3,231.77 per equity share is fair and reasonable. This assessment is based on:

1. The offer price being in line with SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 2011
2. Comparison with recent market prices:
   • NSE closing price on October 15: ₹3,392.30
   • BSE closing price on October 15: ₹3,385.30

Implications for Shareholders

The IDC has advised shareholders to independently evaluate the offer, considering factors such as:

1. The offer price
2. Current market performance of Akzo Nobel India's shares
3. Individual investment objectives

Shareholders are encouraged to seek independent financial advice before making a decision.

Market Context

This open offer comes at a time when the Indian paints industry is witnessing increased competition and consolidation. JSW Paints' move to acquire a significant stake in Akzo Nobel India could potentially reshape market dynamics and competitive positioning within the sector.

Next Steps

Shareholders of Akzo Nobel India will now have the opportunity to tender their shares in response to this open offer. The outcome of this offer could have significant implications for both companies and the broader paints industry in India.

As the situation develops, market observers will be keenly watching for any regulatory approvals required and the response from Akzo Nobel India's current management and major shareholders.

Akzo Nobel India , a leading decorative and industrial paints company, is set to see a significant change in ownership as JSW Paints announces plans to acquire up to 26% stake in the company. The open offer, valued at ₹2,997.11 crore, marks a substantial move in the Indian paints sector.

Key Details of the Acquisition

• Offer Size: JSW Paints aims to acquire up to 1,18,40,482 fully paid-up equity shares, representing 26% of Akzo Nobel India's voting share capital.
• Offer Price: ₹3,231.77 per equity share.
• Total Consideration: Up to ₹2,997.11 crore, assuming full acceptance.

Strategic Implications

This acquisition is part of a larger transaction where JSW Paints has agreed to purchase up to 74.76% of Akzo Nobel India's voting share capital from its current promoters. The deal structure includes:

1. Direct acquisition of up to 3,40,44,335 equity shares (74.76%) from the current promoters.
2. An open offer to public shareholders for an additional 26% stake.

Financial Arrangements

JSW Paints has made firm financial arrangements for the offer:

• Escrow account established with Kotak Mahindra Bank Limited.
• Bank guarantee of ₹500.00 crore provided.
• Cash deposit of ₹42.00 crore made in the escrow account.

Market Impact

The acquisition is expected to significantly alter the competitive landscape of the Indian paints industry. JSW Paints, part of the $23 billion JSW Group, will gain substantial market share and access to Akzo Nobel India's established brand and distribution network.

Regulatory Approvals

The deal has received approval from the Competition Commission of India, a key regulatory requirement for its completion.

Outlook

This strategic move by JSW Paints underscores its ambition to expand its presence in the Indian paints market. The acquisition of Akzo Nobel India, with its strong market position and diverse product portfolio, is likely to accelerate JSW Paints' growth trajectory and enhance its competitive position in the industry.

Investors and industry observers will be keenly watching how this acquisition unfolds and its potential impact on the dynamics of the Indian paints sector.

Note: The open offer is subject to various terms and conditions as detailed in the Letter of Offer.