Two of the world’s largest paint and coatings companies, AkzoNobel and Axalta, have announced plans to merge in a major all-stock deal that would create one of the biggest coatings groups globally.
If the deal is completed, the merged company would be valued at around AUD $39 billion, with combined annual revenue of about AUD $26 billion. It would bring together AkzoNobel’s strong presence in decorative paints and protective coatings, with Axalta’s expertise in vehicle refinish, mobility and industrial coatings.
Under the terms of the agreement, Axalta shareholders will receive AkzoNobel shares instead of cash. After the merger, AkzoNobel shareholders would own about 55 per cent of the new company, while Axalta shareholders would hold around 45 per cent. AkzoNobel also plans to pay a special dividend of about AUD $4.5 billion to its shareholders before the deal is finalised.
The companies believe the merger will strengthen their competitive position by combining technology, manufacturing scale and global reach. Together, they will operate in more than 160 countries, with 173 manufacturing sites and 91 research and development facilities worldwide.
A major focus of the merger is cost savings and efficiency. The two companies have identified around AUD $930 million a year in pre-tax cost synergies. These savings are expected to come mainly from streamlining operations, improving procurement processes and optimising supply chain networks. About 90 per cent of the savings are targeted within the first three years after the deal is completed.
In terms of financial performance, the merged company is forecast to generate adjusted earnings (EBITDA) of about AUD $5.1 billion a year, with profit margins close to 20 per cent. It is also expected to produce strong cash flow, helping support future investment, innovation and shareholder returns. The group plans to maintain an investment-grade credit rating and will target net debt levels of between 2.0 and 2.5 times EBITDA.
Research and development will be a key part of the combined company’s strategy. The two businesses will have a combined annual R&D budget of about AUD $620 million, focused on developing advanced coatings, improving durability and performance, and supporting more sustainable manufacturing practices. The merged group will employ thousands of scientists and engineers and hold a large global patent portfolio.
Leadership of the new company will include senior figures from both organisations. Current AkzoNobel CEO Greg Poux-Guillaume will lead the merged business as CEO, while Axalta CEO Chris Villavarayan will become Deputy CEO. Axalta board chairman Rakesh Sachdev will chair the new board, which will consist of 11 directors made up of representatives from both companies and independent members.
The combined company will be based in the Netherlands, with dual headquarters in Amsterdam and Philadelphia USA, and will eventually be listed on the New York Stock Exchange under a new name.
The deal still requires approval from shareholders and regulators and is expected to be completed between late 2026 and early 2027.