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Four parties enter into second round bids for Akzo Nobel’s chemical unit: Bloomberg
Posted on Wednesday, 10 January 2018 14:57
Akzo Nobel has narrowed down the list of bidders to three private equity groups and one industry player as it gets closer to divesting its chemical business, Bloomberg reported, citing people with knowledge of the matter.

The sources said Apollo Global, Hal Investments, Carlyle Group and German speciality chemical company Lanxess have entered into the second round of placing offers for the division just less than two years after media news first suggested the sale.

Akzo Nobel, which expects to fetch around EUR 10.00 billion for the unit, has been considering a split from its chemical assets since March 2016 when Evonik Industries was reportedly interested.

It was a year later when the Dutch paint and coatings company announced it was reviewing options for the division, including a sale and an initial public offering.

Akzo Nobel has since been under pressure to break up its business in a bid to focus on paints for homes and cars, with activist investor Elliott Management adding to the stress.

The company, known for its Dulux paints, came further into the spotlight after it rebuffed a USD 26.90 billion takeover from PPG Industries in June after months of talks.

Akzo Nobel, which had a market value of EUR 18.90 billion yesterday, is now focused on either selling or spinning off the chemical business and accepted first round bids in late December, sources told Bloomberg.

According to these people, the group has ruled out KKR and CVC Capital Partners, which were working together on a proposal.

Leslie McGibbon, a spokesperson for Akzo Nobel, told Bloomberg by phone the company had a strong first round and is now progressing with four bidders with the dual track process remaining intact.

The chemical operations account for roughly 40.0 per cent of the group’s revenue and includes products in polymer chemistry, ethylene and sulfer derivatives and salt-chlorine.

It is unclear at this stage when a deal is likely to be announced.

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