DuluxGroup Limited, an Australian paints producer group owned by Paint Holdings Co., Ltd. (NPHD) of Japan, has confirmed entering into a binding agreement to acquire Jub, a large Slovenian paints company, in a deal worth EUR 194.5 million. DuluxGroup plans to turn Jub into a hub for Central and Eastern Europe, preserve its existing brands, and make it part of Nippon Paint’s R&D community.
“Under the auspices of DuluxGroup, Jub will enjoy autonomy and independent growth, while at the same time leveraging the advantages of access to a global market, technologies, capabilities and abundant capital resources of Nippon Paint Group,” the company said in Friday’s press release.
Patrick Houlihan, chairperson and CEO of DuluxGroup, said that with the support of the world’s fourth-largest paint producer, Jub would continue to build its leading position on the regional market, strengthening its innovation, portfolio and geographical reach. It could also play an important role in the group’s expansion to Western Europe.
In a separate release for investors, Nippon Paint said Jub commanded market-leading positions in several paint segments in Slovenia, Croatia, Serbia and Bosnia-Herzegovina, whereby the acquisition will allow it to better use its distribution network.
Nippon Group plans to “build a bridgehead” for decorative paints and external thermal insulation systems in Central and Eastern European Markets.
The transaction involves the purchase of 99.8% of Jub Group. In the Notice of Acquisition of Shares published on Friday, Nippon Paint Holdings Co., Ltd. (NPHD) says that “the European paint market is the world’s second-largest following the China market and has prospects for continuing steady growth. JUB is a manufacturer of decorative paints, ETICS and other paint-related products, with a market presence and an extensive distribution network in Central Europe centred on Slovenia, Serbia, Croatia, and Bosnia and Herzegovina. JUB is one of the market leaders in interior paints in Slovenia, Croatia, and Bosnia and Herzegovina and in façade paints in Slovenia, Serbia, and Bosnia and Herzegovina, commanding a market-leading position”.
The Acquisition is expected to contribute to be EPS accretive from the first year of acquisition. DGL International (UK) Ltd will acquire the shares of JUB, a company newly established in the U.K. by DuluxGroup, using funds provided by NPHD through borrowings from financial institutions.