PPG was also quite active this year – leading an aggressive campaign to acquire AkzoNobel. According to reports in the NY Times, the hedge fund Elliott Management sought to replace the chairman of AkzoNobel, in an increasingly acrimonious fight over whether the company should discuss a takeover. AkzoNobel rejected the proposal and Elliott took the company to court, but a Dutch court ruled in favor of the company.
PPG ultimately dropped its pursuit. “We were hopeful throughout this process that AkzoNobel’s boards would see the merits of our compelling proposal to combine our two great companies and create significant shareholder value and a more sustainable business for the future,” Michael McGarry, PPG chairman and CEO, said in a press release. “As always, PPG remains focused on identifying growth opportunities that will drive value and strengthen our company. We remain committed to our long-standing disciplined approach to business portfolio management and cash deployment.”
In response to PPG’s unsolicited offers, Ton Büchner, CEO of AkzoNobel responded: “We continue to focus on our business, pursuing our strategy of accelerating sustainable growth and profitability and creating two focused, high-performing businesses – Paints and Coatings and Specialty Chemicals. We believe this will lead to a step change in growth and long-term value creation for our shareholders and all other stakeholders.”
According to reports from ICIS Chemical Business, AkzoNobel is engaging in a dual track for the separation of its specialty chemicals business from its core paints and coatings franchise – a sale process along with an initial public offering (IPO) or spinoff.
AkzoNobel’s specialty chemicals business had sales of €4.8 billion. Its five business segments include surface chemistry, pulp and performance chemicals, polymer chemistry, industrial chemicals, and ethyleneand sulphur derivatives. Major product areas include surfactants, ethylene oxide (EO), polymer and rubber additives, chlorine and bleaching chemicals.
It will be quite interesting to see how these changes and more will be reflected in next year’s Top Companies Report.