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




Coatings Industry News

Main News Page

Valspar Sells Wood Coatings Unit for $420M

Thursday, April 13, 2017

Comment | More

In a transaction that The Sherwin-Williams Company and Valspar hope will pave the way for the close of their pending merger, the firms announced on Wednesday (April 12) they have reached an agreement to sell Valspar’s North American Wood Coatings unit to Philadelphia-based coatings company Axalta for $420 million.

The proposed Sherwin-Williams merger with Valspar was announced in March 2016; earlier this year, the two companies said they’d need to complete some kind of divestiture before the merger could close.

Valspar wood coatings

Valspar's North American Industrial Wood Coatings business had revenues of about $225 million in 2016. It produces coatings and finishes for OEM and industrial markets for products such as kitchen cabinets, furniture, hardwood floors, automotive finishes, pianos and hockey sticks.

“With this agreement, we believe that we have addressed regulatory concerns appropriately and we are moving forward to obtain approval for our acquisition of Valspar,” said John G. Morikis, Chairman, President and CEO of Sherwin-Williams.

Wood Coatings for Industry

Valspar's North American Industrial Wood Coatings business had revenues of about $225 million in 2016. It produces coatings and finishes for OEM and industrial markets—under the Valspar Wood, Zenith, Lustre Lac and Grainstone labels—for products such as kitchen cabinets, furniture, hardwood floors, automotive finishes, pianos and hockey sticks.

“This is an outstanding opportunity for Axalta to enter the large Industrial Wood Coatings market with an industry-leading portfolio of products and customers,” Axalta Chairman and CEO Charlie Shaver said. “The strong reputation enjoyed by these brands among a long-term customer base will provide an excellent platform for future growth in this important market.

“Our shared commitment to technology and excellence in application services, as well as a strong pipeline of new products, will enable us to meet the needs of both current and new customers. This acquisition continues to build on our strategy to strengthen and further diversify our Performance Coatings segment.”

Valspar Chairman and CEO Gary E. Hendrickson added, “We believe that Axalta is an excellent buyer for our North American Industrial Wood Coatings business and will provide great opportunities for our talented employees. Axalta is a strong cultural fit with Valspar and shares our commitment to innovation and customer service.  We will work closely with Axalta to ensure a smooth transition of this business.”

Time to Divest

Cleveland-based Sherwin-Williams said during its January earnings announcement that the closing of the $11.3 billion acquisition of Minneapolis-based Valspar was contingent on the divestiture of a business with yearly revenue under $650 million, which would keep the sale price at $113 per share. Selling off business interests with assets of more than $650 million would have dropped the stock price to $105 per share.

John Morkis and Gary Hendrickson

The Axalta deal is a step toward the close of the pending merger between Sherwin-Williams (Chairman, President and CEO John Morikis, left) and Valspar (Chairman and CEO Gary E. Hendrickson).

The merger agreement, which reportedly drew FTC scrutiny last fall, expires June 21. The termination date for the agreement was originally March 21, but Sherwin-Williams needed more time for the divestitures and completion of the Valspar acquisition.

Stock Market Reacts

News of the Valspar sale lifted its stock price 1.09 percent to a 52-week high of $112.42 in Wednesday morning trading. Sherwin-Williams’ shares had a modest gain of .11 percent to $312.75.

Axalta shares dipped 1.69 percent to 31.13.

Coatings Consolidation

The proposed merger between Sherwin-Williams and Valspar is another step toward consolidation in the global paints and coatings industry. Finalizing the merger would create a company with $15.6 billion in sales, with $2.8 billion in adjusted earnings annually.

Pittsburgh, Pennsylvania-based PPG Industries, currently the world’s leading coatings company by sales, is rumored to be preparing another takeover bid and issued another invitation last Wednesday (April 5) to meet with paint and coatings firm AkzoNobel of Amsterdam, Netherlands.

AkzoNobel declined two previous invitations, and recently questioned whether one of its shareholders, hedge fund Elliott Advisers, had inappropriate communication with PPG regarding its call for the dismissal of AkzoNobel’s supervisor board chair.


Tagged categories: Acquisitions; Axalta; Industrial coatings; Mergers; OEM (Original Equipment Manufacturers); Sherwin-Williams; Valspar; Wood coatings

Comment Join the Conversation:

Sign in to our community to add your comments.

Carboline Company
New product: Carbozinc® 608 HB
Introducing a new high build zinc-rich primer that can save you time and money by eliminating the epoxy intermediate coat!

Jotun Paints Inc.
Jotun Jotachar 1709
Mesh-free passive fire protection epoxy designed to protect against hydrocarbon pool fire scenarios for up to four hours as defined in the ANSI/UL1709 standard.

Industrial Vacuum Equipment Corp.
Hurricane Vacuums
& Dust Collectors
Vacuum and dust collector hose, filters and related accessories.

SABRE Autonomous Solutions
The ALPHA1 provides reliable results consistently allowing you to cost your next job with confidence.

HoldTight Solutions Inc.
Our HoldTight®102 salt remover & flash rust
preventer prevents flash
rust by removing surface contaminants. Contact us
for your nearest distributor.
(800) 319.8802

Tarps manufacturing, Inc.
QUALITY MADE IN AMERICA —Available near you!
CLICK to get a behind-the-scenes look at how Tarps Manufacturing makes the highest-quality tarps right here in the USA — available nationwide.

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.

ABKaelin, LLC
Programs/Training/Monitoring for Silica, Lead, Noise, Beryllium, Hexavalent Chromium, Cadmium, Hazardous Waste*PM10 & TSP-Lead Ambient Air Monitoring*SSPC C3/C5

DeFelsko Corporation
PosiTector SST Soluble Salt Tester
Measures the concentration of soluble salts on metal surfaces. Use with all Bresle patch types including the reusable, adhesive-free PosiPatch.

Modern Safety Techniques
Modern Safety Techniques
With our unique LTCat, we can help to provide clean, safe breathing air to your workers. Take a look at our Breathing Air Systems, we supply at least twice as much charcoal as our competitors! Modern


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

TEL 1-412-431-8300  • FAX  1-412-431-5428  •  EMAIL

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   |   Privacy policy   |   Terms & conditions   |   Site Map   |   Search   |   Contact Us