Amsterdam, the Netherlands
AkzoNobel saw revenues increase five percent to $12.85 bn in 2012. The Decorative Paints business achieved a two percent revenue increase, from $5.59 bn in 2011 to $5.71 bn in 2012. The Decorative Paints business differs from Akzo’s other business areas in that revenues come from one end-user segment – building and infrastructure. All revenues also come from three sub-segments – new build projects, maintenance, renovation and repair. All three sub-segments of the building and infrastructure end-user segment were negatively affected by the economic slump.
The Performance Coatings unit, which includes auto and aerospace coatings, powder coatings, marine and protective coatings, industrial coatings and adhesives, saw 2012 revenues rise 11 percent from $7.20 bn to $7.58 bn. Industrial coatings – boosted by acquisition activity – achieved the strongest growth, followed by marine and protective coatings. Marine and protective coatings had a good year, led by a strong sales increase of protective coatings. The main driver for this was the increasing global capacity in the oil and gas industry. The company’s Chartek range of fire protection coatings, in particular, benefited significantly. The marine coatings business suffered from a major slowdown in new builds. It was a similar situation in the vehicle refinish sector, where reduced volumes, especially in Europe, put pressure on the company’s automotive and aerospace coatings business. Industrial coatings performed well in 2012, boosted by the previous year’s acquisition of Schramm Holding AG and the coatings activities operated by Korean company SSCP. Wood finishes and adhesives also bounced back and the company reported that powder coatings achieved a solid performance.
The company made the decision to divest its North American decorative coatings business to PPG in a deal valued at $1.05 billion. The deal includes the decorative paints business in the U.S., Canada and Puerto Rico.
AkzoNobel has made the strategic choice to focus its decorative paints business on key markets in Europe and its strong positions in high growth regions. The cash proceeds of approximately $875 million will be deployed to support the company’s strategy. This includes investing in organic growth for AkzoNobel, and reducing net debt.
“Over the past four years, the team has done a great job in turning the North American decorative paints business around,” said Ton Büchner, CEO of AkzoNobel. “We are convinced that decorative paints can get better returns from our leading positions in Europe and high growth markets. I am pleased that we have found a respected company to take over the business. This agreement is a good outcome for all stakeholders.”
YEAR ESTABLISHED: 1994
REVENUE: $12.85 billion t (2011: 14.577 bn)
• Decorative paints • Marine and protective coatings
• Auto and aerospace coatings • Industrial coatings
• Powder coatings •Wood finishes and adhesives
Ton Büchner, chairman and CEO; Tex Gunning, board member responsible for Decorative Paints; Leif Darner board member responsible for Performance
Coatings. Decorative Paints managing directors: Richard Stuckes, Europe, Middle East and Africa; Bob Taylor, North America; Jaap Kuiper, Latin America; Jeremy Rowe, South East Asia and Pacific; Amit Jain, India and South Asia; Lin Liangqi, China and North Asia. Performance Coatings managing directors: Rob Molenaar, marine and protective coatings; Jim Rees, automotive and aerospace coatings; Conrad Keijzer, industrial coatings; AB Ghosh, powder coatings; JohnWolff, wood finishes and adhesives; Graeme Armstrong, board member responsible for research, development and innovation.