Masterstroke! Parth Jindal’s Daring Deal Adds Dulux to JSW’s Palette

Image Source: The Economic Times

In a months-long, high-profile battle for control of a company, JSW Paints Managing Director Parth Jindal negotiated one of India's most innovative deals by acquiring Akzo Nobel India, the maker of Dulux paints. The transaction, valued at approximately ₹13,000 crore, is the biggest and most significant moment of Jindal's career and takes JSW Paints to the highest echelons of the Indian decorative paints sector.

Key Highlights:

Surprising Twist:

Just as Jindal was about to welcome his winning bid, a surprise counterbid at 7-8% more was made by Advent International and Indigo Paints consortium at the eleventh hour, threatening to derail the deal.

All-Out Negotiation:

The JSW group, in-house code-named the deal 'Project Lakshmi,' worked furiously to overcome the rival bid, heavily relying on in-house resources as well as trusted advisors to maintain their bid on the table.

Strategic Reasoning:

Akzo Nobel global CEO Greg Poux-Guillaume emphasized the decision was more than about price: "Identifying the right home for the business and a long-term partner was priceless," citing JSW's values, in-country experience, and growth ambitions as the determinants.

Deal Structure:
JSW Paints acquired a 74.76% stake for ₹8,986 crore and made an open offer for the balance 25% for ₹3,929 crore. The acquisition is financed through a mix of promoter equity, debt, and private equity.

Market Impact:

Combined, the company will be India's fourth-largest paint company, and three years from now, hopes to be part of the top three. JSW will carry on with the Dulux brand, while JSW Paints will occupy the value segments.

Akzo Nobel's Continuing Presence:

Akzo Nobel retains its powder coatings and R&D unit in India and will remain a technology partner, receiving a 4.5% royalty on industrial coatings.

Vision for Growth:
Jindal's aggressive game plan is to redefine the competitive space, with a vision to leverage Akzo Nobel's distribution (19,000 outlets) and brand power to double the top line and capture market share. This blockbuster transaction not only establishes Parth Jindal as a dealmaker but also signals a new era of consolidation and ambition for India's $9 billion paint sector.

Source: The Economic Times