AkzoNobel confirms focus on its own strategy to accelerate growth and value creation
Decision follows extensive review and careful consideration of third unsolicited proposal from PPG
AkzoNobel announces it has declined a third unsolicited, non-binding and conditional proposal submitted by PPG Industries on April 24, 2017, for all outstanding ordinary shares in the capital of AkzoNobel.
AkzoNobel has concluded its own strategy, presented on April 19, 2017, offers a superior route to growth and long-term value creation and is in the best interests of shareholders and all other stakeholders.
This decision follows considerable in-depth analysis of PPG's proposal by the Supervisory Board and Management Board of AkzoNobel, working closely with their financial and legal advisors. As part of this process, on May 6, 2017, Ton Büchner, CEO, and Antony Burgmans, Chairman of the Supervisory Board of AkzoNobel, met with Michael McGarry, Chairman and CEO, and Hugh Grant, Lead Independent Director of PPG.
In the execution of their fiduciary duties, the absolute focus of the Boards has been to determine whether the proposal by PPG fits with AkzoNobel's strategic objectives, is in the best interests of the company and creates long-term value for shareholders and all other stakeholders.
After extensive consideration, the company has concluded that the interests of shareholders and other stakeholders are best-served by its own strategy to accelerate growth and value creation. That strategy set out a clear road map for:
- The creation of two focused and high-performing Paints and Coatings and Specialty Chemicals businesses, to enable an acceleration of growth and enhanced profitability
- Significantly increased financial guidance for Paints and Coatings and Specialty Chemicals
- The clear separation of Specialty Chemicals within 12 months with the vast majority of net proceeds to be returned to shareholders
- Increased shareholder returns, including a 50% higher dividend for 2017 and €1 billion special cash dividend payable in November
- The creation of significant value for shareholders in the short, medium and long term, whilst also securing the interest of other stakeholders.
The extensive review and the meeting with PPG confirmed to AkzoNobel that its own strategy is better and does not contain the risks and uncertainties inherent in PPG's proposal. This strategy will build on the existing growth momentum within AkzoNobel and create a step change in value creation for shareholders and all other stakeholders.
PPG's proposal has been tested on four key areas: value, certainty, timing, and stakeholder considerations.
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