M&As: AkzoNobel/Axalta merger to create coatings company of US$25 bn

Netherlands-based paints/coatings firm AkzoNobel NV and US-based Axalta Coating Systems Ltd have entered into a definitive agreement to combine in an all-stock merger of equals, creating a global coatings company with an enterprise value of approximately US$25 billion. The companies expect the transaction to close in late 2026 to early 2027, subject to approval by shareholders of both AkzoNobel and Axalta and other regulatory matters.

The combination brings together two coatings industry leaders with complementary portfolios to better serve customers across key end markets and enhance value for shareholders, employees and other stakeholders, the statement adds.

With attractive margins and robust cash flow generation, the combined company will be well positioned to drive substantial growth and shareholder value creation, building on 2024 revenues of approximately US$17 billion and US$1.5 billion in pro forma Adjusted Free Cash Flow.The combination is expected to drive identified and actionable run-rate synergies of approximately US$600 million, 90% of which are expected to be achieved within the first three years following the close of the transaction.

Ben Noteboom, Chairman of the Supervisory Board of AkzoNobel, said, “This combination represents a compelling opportunity. It’s a great value proposition for all our stakeholders, both in the Netherlands – where we maintain our domicile – and internationally, including our shareholders, customers and employees. It will create a world leader in coatings and is a significant step that will drive sustainable growth and allow us to better serve our customers.”

The merger brings together AkzoNobel’s and Axalta’s complementary portfolios to create a full spectrum offering of coatings solutions, with first-rate franchises across Powder, Aerospace, Refinish, Mobility, Marine and Protective, Industrial Coatings and Decorative Paints. The combined portfolio will be differentiated by its breadth of solutions across approximately 100 well-known brands

The combined company will have an enhanced global footprint spanning 173 manufacturing sites and 91 R&D facilities worldwide, enabling it to bring global capabilities to local customers. Through increased local presence in key geographies, AkzoNobel and Axalta customers are expected to benefit from deep channel access to coatings and product support, further strengthening customer relationships

The combination will enable AkzoNobel and Axalta to deliver increasingly advanced and differentiated products by combining existing technological capabilities across end markets. Joining Axalta’s Refinish, Light Vehicle and Commercial and Industrial Coatings businesses with AkzoNobel’s Powder Coatings, Refinish, Aerospace Coatings, Marine and Protective Coatings, Industrial Coatings and Decorative Paints businesses will create an innovative platform to deliver value to customers.

In addition, sharing best practices across two leading research platforms in the coatings space is expected to accelerate high-value innovation. The combined company will have approximately US$400 million combined annual R&D spend, 91 R&D facilities for local customer needs, approximately 4,200 research fellows, scientists and engineers, and around 3,200 granted and pending patent applications

Inclusive of run-rate synergies, the combined company is expected to have industry-leading profitability with strong Adjusted EBITDA margins approaching 20%1 and substantial cash flow generation. Revenues are expected to be approximately US$17 billion, with adjusted EBITDA of US$3.3 billion and pro forma Adjusted Free Cash Flow of US$1.5 billion.

The Board will be composed of 11 directors – four from each company and three independent members. Of the 11 Board members, two will be executive directors and nine will be non-executive directors. Each company expects to hold its respective Extraordinary General Meeting of Shareholders tentatively in mid-2026.

Current AkzoNobel CEO, Greg Poux-Guillaume, will serve as CEO of the combined company, and current Axalta CEO, Chris Villavarayan, will serve as Deputy CEO. Current Axalta SVP and CFO, Carl Anderson, will serve as the CFO of the combined company. Current AkzoNobel CFO, Maarten de Vries, will retire from AkzoNobel prior to closing as previously announced.

In connection with the transaction, AkzoNobel will pay a special cash dividend to AkzoNobel shareholders equal to EUR2.5 billion minus the aggregate amount of any regular annual and interim dividends paid by AkzoNobel to AkzoNobel shareholders in 2026 prior to completion. AkzoNobel shareholders will own 55% and Axalta shareholders will own 45% of the combined company on a pro forma basis immediately after closing.

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