PaintSquare.com
Follow us on Twitter Follow us on LinkedIn Like us on Facebook Follow us on Instagram Visit the TPC Store
Search the site

 

Advertisement

PaintSquare


PAINTSQUARE BLOG

Comment |

Merger Mania, and Why It Matters

THURSDAY, MAY 16, 2013

By Karen Kapsanis


More items for Coating Materials

Over the past 30 years in the coatings industry, mergers and acquisitions have affected every kind of coatings-related business—from coatings suppliers and equipment manufacturers to contractors, raw materials suppliers, and consultancies.

For most people, M&As have more to do with high-level executives, stockholders, and boards of directors. It’s just business.

AkzoNobel

The corporate coatings landscape is in perpetual flux. In 2012, AkzoNobel split off ICI Pakistan and created a separate paint business called AkzoNobel Pakistan Limited.

Companies are in the business of making money for themselves and their stockholders. It’s the rarefied atmosphere of high finance.

Feeding the Corporate Beast

Of course, it’s not just a coatings thing: Small and large companies of all sorts have whetted the appetites of larger companies around the world.

Here in Pittsburgh, we are getting our own taste of corporate consumption in everything from non-profits to airlines to a beloved Pittsburgh original: Berkshire Hathaway and 3G Capital just bought Heinz.

Warren Buffett's Berkshire Hathaway just partnered with 3G Capital to swallow Heinz.

The region’s main health insurance company just acquired about half a dozen hospitals. More than a dozen other hospitals in the region have merged or been purchased over the past decade or so by what is now one huge health care system—with its own insurance program.

American Airlines and U.S. Airways are merging. Years ago, our then-largest regional bank sold its retail operations and joined up with a major financial institution, and the banking headquarters left town.

Ralph Lauren Paints

Last year, Ralph Lauren Paints was a brand of AkzoNobel. Today, it belongs to PPG, acquired with the rest of  AkzoNobel's North American Decorative Paints business.

Ripple Effects and Aftershocks

But employees who don’t live in the world of high finance and whose companies have been bought, sold or merged know firsthand the other risks and effects of such deals—job insecurity, financial instability, loss of health insurance, problems paying the bills.

We’re feeling them right here in Pittsburgh. Eliminating duplicate departments in any M&A often means job loss, and once the Heinz deal was announced, many Pittsburghers started wondering if or how many Pittburgh jobs would be eliminated, and everything that goes with those jobs.

Georgia Gulf

PPG recently split off its Commodity Chemicals unit into a new company called Splitco, and then immediately merged the business with chemical maker Georgia Gulf into a new independent entity called Axiall Corp. Got that?

The airline M&A, the bank deals, and all the other consolidations likely have raised similar questions among employees.

Gains and Losses

And there are other costs here. Airline ticket prices have already gone up. Job losses will hurt the region’s economy.

As for the two major health systems here, each with its own hospitals and health insurance program, the potential conflict of interest between keeping insurance coverage costs down and providing the best available medical treatment is only one of the ways these M&As put the quality of health care in Pittsburgh at risk (for anyone lucky enough to have health insurance).

Metlac

AkzoNobel recently suffered a rare setback in the M&A world when the UK put the brakes on its plan to purchase packaging coatings maker Metlac.

Mergers and acquisitions: It’s not just business. It’s personal. Your community’s economy. Your job. Your mortgage. Your family’s grocery bill, well being, and health.

ABOUT THE BLOGGER

Karen Kapsanis

Karen Kapsanis was the Editor in Chief of the Journal of Protective Coatings & Linings when these blogs were written. Post-JPCL, Karen remains an inexplicably lifelong fan of the Green Bay Packers and a surprisingly speedy sprinter.

SEE ALL CONTENT FROM THIS CONTRIUBTOR

   

Tagged categories: Acquisitions; AkzoNobel; Business matters; Mergers; PPG

Comment from Bogdan Dana, (5/17/2013, 3:46 AM)

Maybe it is just me, I am not trying to be phylosophical, but mergers and acquisitions are made with just one purpose in mind: to make more money with less work. Some Companies make a stretch though to buy others hoping they will then get bigger purchasing power for their raw materials they use to make their finished products, so they are not all that bad (the big conglomerates). Best regards, Bogdan Dana


Comment Join the Conversation:

Sign in to our community to add your comments.

Advertisements
 
Jotun Paints Inc.
 
Jotachar JF750 - The Time Saving Solution
 
The only mesh free solution for jet fire scenarios. Jotachar saves installation time and material costs - the next generation of epoxy passive fire protection.
 

 
Mitsubishi Gas Chemical America
 
Performance Amine 1,3-BAC
 
A highly reactive cycloaliphatic diamine offering superior performance. Reasonable cost and curing efficacy makes it suitable for all types of epoxy resin applications.
 

 
PPG Protective and Marine Coatings Group
 
We Protect and Beautify the World
 
PPG is widely recognized as a world leader in protective and marine coatings, developing innovative, cutting-edge products and services.
 

 
SABRE Autonomous Solutions
 
Safety
 
Removing blasting operators from harmful environments is our key objective.
 

 
Carboline Company
 
Carboline is pouring with opportunities
 
We are proud of our exceptional products and services, and believe that people are our greatest asset. Come grow with us!
 

 
Sherwin-Williams
 
Sherwin-Williams General Polymers Resinous Flooring App
 
Our coatings and linings expertise available 24/7, allowing you to explore the Sherwin-Williams systems best suited for your flooring needs. Android Users Click here to Download the app today!
 

 
BASF
 
New resins from BASF will have metals loving water!
 
Excellent corrosion resistance, low VOC, high gloss, thin films www.basf.us/industrialcoatings dpsolutions@basf.com 800-231-7868
 

 
KTA-Tator, Inc. - Corporate Office
 
New KTA Pipeline Inspection Kit
 
• Defelsko standard memory body
• Positector FTS 0-250 mils, cabled dry film thickness probe
• NEW Positector Shore D hardness probe
• All essential inspection equipment!
Visit www.ktagage.com
 

 
Safway Services
 
Your Access Advantage. QUIKDECK®
 
Provides safe, factory-floor-like working conditions. Can be engineered to fit almost any shape, structure or size. Modular platform easily assembled from just a few basic components. Excellent containment. Applications include vessels, offshore rigs and bridges.
 

 
Strategic Materials Inc.
 
www.truabrasives.com
 
TruAbrasives™, a clean crushed glass abrasive superior to other abrasives for performance, health, and environmental benefits.
 

 
 
 

Technology Publishing Co., 1501 Reedsdale Street, Suite 2008, Pittsburgh, PA 15233

TEL 1-412-431-8300  • FAX  1-412-431-5428  •  EMAIL webmaster@paintsquare.com


The Technology Publishing Network

Durability + Design PaintSquare the Journal of Protective Coatings & Linings Paint BidTracker

 
EXPLORE:      JPCL   |   PaintSquare News   |   Interact   |   Buying Guides   |   Webinars   |   Resources   |   Classifieds
REGISTER AND SUBSCRIBE:      Free PaintSquare Registration   |   Subscribe to JPCL   |   Subscribe to PaintSquare News
MORE:      About PaintSquare.com   |   Privacy policy   |   Terms & conditions   |   Site Map   |   Search   |   Contact Us