Akzo responds to PPG - after the takeover battle ends

Cans of Dulux paint an Akzo Nobel brand are seen on the shelves of a hardware store near Manchester Britain

Cans of Dulux paint an Akzo Nobel brand are seen on the shelves of a hardware store near Manchester Britain

USA paints and coatings maker PPG Industries PPG.N will not launch a formal bid for Dutch rival Akzo Nobel AKZO.AS after repeated informal offers were rejected, it said on Thursday.

The decision comes after PPG failed to gain an extension from Dutch authorities on Thursday's deadline to make a formal offer.

The capitulation marks a setback in PPG's efforts to strengthen its global reach and allows it to offer customers a broader portfolio of paints and coatings.

PPG chief executive Michael McGarry said the U.S. company had been "hopeful" AkzoNobel "would see the merits of our compelling proposal to combine our two great companies and create significant shareholder value".

The group added that it made a final attempt at engaging with AkzoNobel's board last week, but did not receive a response.

With the withdrawal a period of three months in which PPG offered for AkzoNobel came to an end, at least for six months.

"We highly value shareholder perspectives and regret that a number of shareholders believe we have insufficiently explained our considerations in respect of PPG's proposals", Akzo Chief Executive Ton Buechner said in a statement".

A shareholder group led by billionaire Paul Singer's Elliott Management, representing about 18 percent of Akzo's stock, lost a bid at the Amsterdam Enterprise Chamber on Monday to force Akzo's boards to engage in talks with PPG.

When PPG's interest became known one week before national elections on March 15, Economic Affairs Minister Henk Kamp branded an Akzo Nobel takeover as "not in the national interest". "We will deliver this within a clear timeline, without the substantial level of risks and uncertainties attached to the alternative proposal".

AkzoNobel shares fell sharply on the news before regaining ground to trade 0.46% lower.

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