Japan’s top paint maker, Nippon Paint Holdings Co. Ltd on Friday said it has signed a deal worth $12.18 billion with Singapore’s Wuthelam Group, whose stake in the Japanese company will rise to just under 60 per cent from 39 per cent. This is one of the biggest transactions in Asia this year.
Nippon Paint said it would use the funds raised and additional cash to buy out Wuthelam from their Asian joint ventures in countries like China, Malaysia and Thailand, as well as acquire Wuthelam’s wholly owned business in Indonesia. It said it expects the deal to be finalised in January and it would need to be cleared by regulators in each of the markets where the businesses operate
The 139-year-old Japanese firm is seeking growth outside its mature domestic market and has prioritised global expansion. Last year, it acquired Australia’s top paint maker DuluxGroup Ltd in a near $3 billion deal.
Asia accounts for 52 per cent of Nippon Paint’s revenue, compared with 26 per cent for Japan, according to the company’s website. The company may pursue more M&A deals should it need additional capital, Nippon Paint said during a conference call. “Asia is becoming a key region for the company’s sustainable growth in terms of both market size and growth rate due to its projected demographic and economic growth leading to increasing demand,” Nippon Paint said in a statement.