Nippon Paint shares jump most in 24 years on US$2.3 billion deal
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SHARES of Nippon Paint surged following its announcement of a deal to acquire a US-based chemicals formulator.
The stock price for the Japanese firm gained as much as 23.6 per cent on Tuesday (Oct 29), the most since February 2000. The company said it will acquire Tennessee-based AOC from Lone Star Fund for US$2.3 billion on Monday.
“We are positive on this news given the large EPS contribution and high profitability,” wrote SMBC Nikko Securities analysts Yasuhiro Shintani and Go Miyamoto in a note on Monday. “We think this deal will contribute to regional diversification as well as EPS growth.”
Nippon Paint has been expanding its business through M&A in recent years. The firm acquired Australian company DuluxGroup back in 2019, and also bought Europe’s Cromology Holding and its subsidiaries in 2021. BLOOMBERG
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