International. AkzoNobel confirmed that it rejected a second unsolicited, non-binding and conditional proposal from PPG Industries Inc. for all common shares issued and outstanding in akzoNobel's capital.
For the Dutch company, the proposal not only does not reflect the current and future value of AkzoNobel, but also neglects to address significant uncertainties and risks for shareholders and other stakeholders.
AkzoNobel's Board of Directors and Supervisory Board, together with its financial and legal advisors, reviewed the second proposal taking into account the interests of AkzoNobel's shareholders, customers, employees and other stakeholders. The revised proposal represents a value of €88.72 (adjusted for the final dividend) consisting of €56.22 (adjusted for the final dividend) in cash and 0.331 PPG shares, as of March 20, 2017, per AkzoNobel share.
AkzoNobel shared some points for which he did not accept this second offer, after the first one received on March 9:
- It is not in the best interest of shareholders.
- Contains significant risks related to the increase in the share component and the high leverage of the proposed combined businesses.
- It would result in a large number of substantial divestments due to the greater geographical and segment overlap of both companies through decorative paints and performance coatings, calling into question the value leakage.
- It will cause major job cuts. It includes synergies that can be expected to result in the restructuring of the combined employee base, leading to job losses.
- Does not address the fundamental concerns and uncertainties of stakeholders or support any tangible solution in relation to, inter alia, R&D, pensions and employees.
- Does not meaningfully address our concerns regarding community contribution and sustainability and the significant cultural gap between the two companies, including how issues arising from this will be addressed.
Source: AkzoNobel.
