The battle to take over Akzo Nobel India's operations has become the most thrilling twist in Indian paints. As top global private equity players Blackstone, Warburg Pincus, Carlyle Group, and CVC Capital Partners get involved, stakes are higher than ever. These companies are looking not just at the Indian business of Akzo Nobel, the owner of the iconic Dulux brand, but also its wider South Asian presence, which covers important markets such as Pakistan, Nepal, and Sri Lanka.
Among the homegrown players, JSW Paints, with the support of TPG, and Pidilite Industries are already in the fray, indicating the increasing significance of India's decorative paints market. However, big players like Asian Paints, the industry leader, have opted out, primarily due to concerns over regulatory hurdles from India’s fair-trade regulator, the CCI.
In October 2024, Akzo Nobel NV, the Dutch parent company, initiated a strategic review of its South Asian operations. The objective is evident: to rationalize capital and concentrate on its fundamental coatings business. As part of the process, Akzo Nobel India has been scouting for possible divestments, including the disposal of its powder coatings division and R&D activities. The company is also mulling the sale of core intellectual properties related to its decorative paints business.
Akzo Nobel India’s revenue reached Rs 3,961.6 crore in FY24, underscoring the importance of its business in the $8.5 billion Indian paints industry. The architectural paints sector continues to be the largest, accounting for 70% of the market share, while the industrial segment takes up the remaining 30%.
This race for acquisition can remake the Indian paint industry landscape, with private equity investors injecting new strategies and capital. It will be interesting to observe who wins this battle and how this will affect the industry and the larger South Asian market in the years ahead.
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