The $25 billion merger enters a critical regulatory window: AkzoNobel and Axalta plan to divest Axalta’s vehicle refinish business.

Huizheng Information reports that AkzoNobel and Axalta plan to sell Axalta’s Vehicle Refinish business to secure conditional approval from the European Commission for their $25 billion merger. The two parties met with the European Commission on October 7 to discuss remedial measures and plan to formally submit their proposal next week. This submission will extend the original decision deadline of October 22 by approximately 10 working days. Background of the transaction: The two companies announced their merger plan in November 2025, with a total deal value of $25 billion. The merger will be executed as an all-stock, “equal” combination to form a global coatings enterprise. Upon completion, former AkzoNobel shareholders will hold 55% of the new company, while former Axalta shareholders will hold 45%, and will also receive a special cash dividend of $2.5 billion. The new company plans to establish dual headquarters in Amsterdam, the Netherlands, and Philadelphia, USA. It is expected to generate annual revenue of approximately $17 billion and adjusted EBITDA of around $3.3 billion, with the parties forecasting annual cost savings of about $600 million. The merger has already received overwhelming shareholder approval on August 5, 2026: 98.87% of AkzoNobel’s shareholders voted in favor, and 99% of Axalta’s shareholders approved the deal. Axalta primarily operates in automotive OEM coatings, vehicle refinish coatings, and industrial coatings—with a strong presence in the U.S. market—while AkzoNobel possesses a production and sales network spanning Europe and other international markets. The two aim to integrate operations to reduce costs and respond to pressures including raw material price volatility, shifts in trade policy, and intensifying industry competition. The European Commission has registered the merger under case number M.12269 – AKZONOBEL / AXALTA and received the formal notification on September 17, 2026. If ultimately approved subject to conditions, the merged entity will cover decorative coatings, industrial coatings, automotive OEM coatings, and vehicle refinish coatings—becoming a globally leading, end-to-end “one-stop” solutions platform in the coatings industry, thereby reshaping the global competitive landscape.

While the world’s second-largest coatings company awaits regulatory clearance, how did Nippon Paint respond first?

Huizheng Information reports that on October 19, Nippon Paint released a summary of its investor Q&A session, drawing market attention back to its $1.35 billion acquisition announced two weeks earlier. When asked by investors whether it would continue pursuing acquisitions, Nippon Paint’s management responded with restraint and clarity: the acquisition of decorative coatings businesses across seven Southeast Asian countries is a ‘bolt-on’ deal, where synergies constitute the primary source of value—but the principle of “not overpaying based on anticipated synergies” remains unchanged. Rewinding to October 5: Nippon Paint and AkzoNobel announced simultaneously that the latter would sell its decorative coatings businesses in Vietnam, Indonesia, Malaysia, Thailand, Singapore, Papua New Guinea, and Australia to Nippon Paint for a total of $1.35 billion. The purchase price represents approximately 21x the target’s 2025 EBITDA; however, factoring in synergies and projected 2026 performance, the effective multiple drops to just over 10x. The transaction will proceed in phases: the Indonesian business is expected to close separately by the end of 2026, while the remainder will close in mid-2027, pending regulatory approvals. The underlying rationale behind this deal extends far beyond the simplistic narrative of “Nippon Paint snagging a bargain.” In April, Nippon Paint had jointly launched a €12.5 billion all-cash bid for AkzoNobel alongside Sherwin-Williams—only to be rejected. In July, it scaled back its ambition and submitted a standalone €7.5 billion offer for AkzoNobel’s entire decorative coatings division—again rebuffed. Only in October did the deal finally materialize, covering just these seven countries. Three attempts, each progressively narrowing in scope: what Nippon Paint ultimately secured is precisely the asset it knows best and where synergy realization is most certain—yet it leaves the market with one lingering question: Why was AkzoNobel so determined to sell? The answer surfaced densely around October 15. On the same day, AkzoNobel and Axalta jointly announced the name of their merged entity—“Axanzo”—and confirmed the transaction is slated to close in early 2027. Management structure was also finalized: AkzoNobel CEO Greg Poux-Guillaume will serve as CEO of the new company, while Axalta CEO Chris Villavarayan will assume the role of Deputy CEO. A more critical signal emerged from the regulatory front: both parties have formally submitted antitrust remedial commitments to the European Commission, with the core proposal centered on divesting AkzoNobel’s vehicle refinish business to alleviate concerns over market concentration in that segment post-merger. As a result, the European Commission’s preliminary review period has been extended into November, marking the start of substantive assessment. It is against this backdrop that the announcement on October 12—of the closure of AkzoNobel’s Nashville, Tennessee powder coatings plant—ceased to be an isolated local news item. AkzoNobel confirmed the facility will shut down by the end of 2026, eliminating 75 positions, with existing capacity to be transferred to three other plants located in Reading, Pennsylvania; Warsaw, Indiana; and Monterrey, Mexico. The company attributed the closure to its “Industrial Excellence” program launched in 2023, citing reasons of “operational optimization” and “reducing manufacturing network complexity,” and explicitly stated the decision is “unrelated” to the AkzoNobel–Axalta merger. Yet the mere chronological juxtaposition speaks volumes: on one hand, AkzoNobel is selling its decorative coatings businesses across seven Southeast Asian countries to Nippon Paint to generate roughly $1 billion in net cash; on the other, it is scaling back its powder coatings manufacturing footprint in North America and concentrating resources on core production lines. Through a series of strategic “subtractions,” AkzoNobel is actively creating financial and operational headroom for its $25 billion equal merger.

Akzo Nobel in Talks to Sell European Vehicle Refinishing Unit for Axalta Deal Approval

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Akzo Nobel is reportedly negotiating to sell its European vehicle refinishing business to gain regulatory approval for its proposed merger with Axalta Coating Systems, according to the Wall Street Journal.

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