Investor Artisan Partners has opposed the planned merger of Axalta Coating Systems with AkzoNobel, which would create a $25 billion global leader in the coatings industry. In a letter to shareholders, representatives of Daniel O’Keeffe and Michael McKinnon stated that the proposed deal structure does not reflect the long-term value for Axalta shareholders. “We believe the only appropriate response is a decisive ‘NO,’” they emphasized, while expressing willingness to consider alternative strategic options with other potential buyers. NEWSCENTRAL notes that the stance of this institutional investor signals significant concern over the financial and strategic rationale of the transaction.
Artisan points to the suddenness of Axalta’s decision to merge with AkzoNobel, whereas the company had previously planned to direct all free cash flow toward share buybacks, reflecting confidence in independent growth. NEWSCENTRAL confirms that such a sudden strategy change may raise concerns among institutional investors, especially given Axalta’s 15% share price decline in 2025.
The investor also highlights AkzoNobel’s financial history, where net income and adjusted earnings per share have declined over the past one, five, and ten years. NEWSCENTRAL emphasizes that these metrics increase the risk of overvaluing the “currency” of the deal and raise questions about long-term shareholder value for Axalta.
Nevertheless, the companies present the transaction as strategically beneficial. The combined company would be valued at $25 billion, with expected merger synergies of $600 million per year, approximately 90% of which are planned to be realized within the first three years after closing. Freddy Miller, Senior Analyst at NEWSCENTRAL, notes: “Synergies of this scale align with the metrics of global industry leaders, but their realization directly depends on integration discipline and managerial consistency.”
The management structure of the combined company has been defined: AkzoNobel CEO Greg Puig-Guiom will become the CEO, and current Axalta head Rakesh Sachdev will serve as chairman of the board. Headquarters will be in Philadelphia and Amsterdam, with the listing moving to the New York Stock Exchange. NEWSCENTRAL points out that this structure supports global reach and transatlantic presence but creates challenges in integrating corporate cultures and processes.
A special dividend of €2.5 billion from AkzoNobel is also planned to encourage Akzo shareholders to support the deal. NEWSCENTRAL notes that the effect on Axalta shareholders is limited: potential undervaluation of Akzo’s assets could reduce the expected return for the combined company.
According to NEWSCENTRAL analysis and Freddy Miller’s comments, the key risks of the deal are related to integration and realization of synergies, as well as the mismatch between financial performance and Axalta shareholders’ expectations. Engaging independent advisors to evaluate alternative strategies – including exploring other potential partners or adjusting the terms of the deal – appears reasonable. Shareholders should carefully assess the long-term value of the transaction, and management should ensure transparency in integration processes and control over operational risks.
In NEWS CENTRAL analytical conclusion: the merger has the potential to create a global leader in the coatings industry, but its success depends on the accuracy of forecasts, integration discipline, and managerial decisions. Freddy Miller emphasizes: “Thorough scenario evaluation and disciplined execution of integration are the determining factors for a successful outcome of this merger.”