Shares of paint company Akzo Nobel India Ltd were trading in the green and 2% higher on 25 February after the company announced that Akzo Nobel N.V. had made a legally binding offer to purchase its research and development centre and powder coatings division.

Akzo Nobel will use a slump sale to transfer the powder coatings business and international R&D centre as a going concern. The powder coatings company will be sold for Rs 2,073 crore, while the R&D Center will be sold for Rs 70 crore.

The company’s board has also approved Akzo Nobel India’s payment of Rs 1,152 crore to purchase Akzo Nobel Coatings International B.V.’s intellectual property rights related to the decorative paints industry in Bangladesh, Bhutan, Nepal, and India. The lowest of the valuations obtained by the two independent valuation studies is the proposed acquisition consideration.

“These transactions will make Akzo Nobel India a more focused liquid paints and coatings business and enable it to become a fully brand-and-technology-independent company for its core decorative paints business,” the company said in an exchange filing.

Execution of these agreements requires approval from the supervisory board of Akzo Nobel N.V. and the shareholders of Akzo Nobel India.

Shareholder consent will be sought in the following weeks, and the voting process is expected to conclude a month later, according to Akzo Nobel India.

In the fiscal year 2024, Akzo Nobel’s powder coatings division reported revenues of Rs 421.2 crore, or 10.7% of the company’s total topline, while the R&D centre contributed 1.36%.

The first statement about the sale of the enterprises mentioned above was made in January of this year.

At 3:18 pm, the shares of Akzo Nobel were trading 1.115 higher at Rs 3,310.15 on NSE.

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