Nippon Paint Holdings Co. Ltd on Friday said it has signed a deal worth 1.285 trillion yen ($12.18 billion) with Singapore’s Wuthelam Group.
As part of the deal, Nippon Paint will sell 1.185 trillion yen ($11.2 billion) worth of shares to Wuthelam, whose stake in the Osaka based Japanese company will rise to around 60% from current 39%.
Japan’s paint manufacturer said it will use the funds raised to buy out Wuthelam from their Asian joint ventures in countries including China, Malaysia and Thailand, as well as acquire Wuthelam’s wholly owned business in Indonesia.
“Asia is becoming a key region for the company’s sustainable growth in terms of both market size and growth rate due to its projected demographic and economic growth leading to increasing demand,” Nippon Paint said in a statement.
Yuichiro Wakatsuki, chief financial officer of Nippon Paint Holdings, said the deal with Wuthelam would “strengthen its balance sheet”, and was expected to result in a 0.6 % increase in profit margins and earnings per share growth of over 10%.
Last year, Nippon Paint acquired Australia’s top paint maker DuluxGroup Ltd. in a $3 billion deal.
