With $2.8 billion in sales revenue for 2010—up from $2.4 billion the year before— Kansai Paint operates three state-of-the-art automotive paint plants from its headquarters in Osaka, Japan and is the leading supplier of automotive coatings to Toyota, Suzuki, Nissan, Honda, Peugeot and Renault worldwide.
Kansai Paint divides its business into automotive (47 percent), industrial (24 percent), decorative (19 percent), and marine and protective (10 percent) segments.
Continuing its push into China, Kansai Paint announced that it will establish a wholly owned subsidiary, which will be mainly engaged in China businesses, strategy formulation, marketing and capital management in Shanghai, China, in June 2010.
Most recently, after a year of bitter opposition, a competition watchdog has approved Kansai Paint’s $260 million takeover bid of South Africa’s Freeworld Coatings. Currently ranked 32nd in this report, this deal represents a significant push into the continent for Japan’s largest paint and coatings maker.
However, the deal has not come without some stringent conditions. The Competition Commission from the beginning said it was prepared to direct how businesses should operate in South Africa to promote economic development when it imposed conditions on the buyout in the interest of competition and public concerns.
South Africa’s Department of Trade and Industry made a submission to the commission asking that the takeover be prohibited on the grounds that the paint market was highly concentrated, and it constituted a threat to the government’s localization drive.
The commission agreed with the department and gave the green light to the transaction on the condition that Kansai divested the automotive coatings business it operated in a joint venture with DuPont, as it would create a “forum for collusion.”
According to the deal, Kansai must manufacture decorative coatings in South Africa for 10 years; establish a manufacturing facility within five years and invest in local research and development.
The commission said these conditions address any anticompetitive harm that would have resulted from the merger and would ultimately increase South Africa’s manufacturing capacity in the paint market.
Despite more than 90 percent of Freeworld shareholders indicating they favored the takeover, the company had bitterly opposed the offer since Kansai made it in April last year.
Kansai Paint, Japan's leading paint manufacturer, with operations in more than 40 countries spanning the globe from Asia to Europe and North America, expanded its operations in 2010 in the Middle East, Central Asian and North African regions as well as India and China.
Formed in 1918, Kansai Paint has since grown to become the 9th largest paint manufacturer in the world and with the establishment of Kansai Paint Middle East (KPME) in Dubai, UAE, as its window company for the Middle East, Central Asian and North African regions including Iran and Pakistan, Kansai is poised to serve these markets with its cutting edge technology.
According to Kobayashi, Kansai Paint is a technology driven company as opposed to being brand driven. As such it operates one of the largest research and development centers for paint and coating solutions in the world. The firm is focused on developing leading technology in coatings, spending more than $50 million annually on research and development alone.