Nippon, BASF, DSM asset restructuring event!

Recently, international chemical giants such as Nippon, BASF, and DSM have all adjusted the current industrial structure, and divested some negative or low-yield assets to adjust their performance structure.

Nippon Reorganization of Automotive Coatings Business

On October 1, Nippon Paint Holdings (hereinafter referred to as "Nippon Paint Holdings") announced that it will reorganize its global automotive coatings business on January 1, 2021. Under the new business structure, Nippon Paint Automotive Coatings Co., Ltd. ("NPAC") will become the headquarters of the global automotive coatings business. The company name and capital relationship after the reorganization will not change.

Through this reorganization, Nippon Paint will quickly realize the benefits of operational integration after announcing the acquisition of 100% ownership of the Asian joint venture and Indonesian business on August 21, 2020, aiming to strengthen Nippon Paint’s global automotive industry Paint business. Japan’s automotive coatings business, the automotive coatings business of the NIPSEA Group, and the automotive coatings business of Europe and the Americas will be merged with NPAC as the global headquarters. In order to provide customers with one-stop information and services, the new company will have customer account managers operating in global and global sales and R&D organizations. In addition, Nippon Paint will enhance its ability to respond to business model innovations in the automotive industry. For example, CASE (Connected, NPHD Chairman, President and CEO Masaaki Tanaka) will also serve as the chairman and CEO of the new company. Shoichi Mure, currently representative director and president of Japan Paint Automotive Coatings Co., Ltd., will serve as president and chief operating officer of the new company.

Masaaki Tanaka, Chairman, President and Chief Executive Officer of Japan Paint Holdings Co., Ltd. said:
"After acquiring 100% ownership of the Asian joint venture and the Indonesian business, the restructuring of the automotive coatings business of Nippon Paint will be the first step for us to create synergy. Nippon Paint recently announced that NPAC will become the third largest in the world. Automobile paint manufacturer, its net sales will exceed approximately 20 billion U.S. dollars. 150 billion yen*[1] and 5,800 employees. The purpose is to integrate the geographically distributed management resources of Nippon Paint and establish a sales A strong global structure centered on R&D and R&D can quickly respond to customer needs. We will actively invest in expanding production capacity and improving the efficiency of our automotive coating plants in Japan. We will also invest in technological innovation to provide customers with product supply and Comprehensive sales support. In addition, we will establish an operating structure that can meet customer requirements in Europe and the Americas to further strengthen our automotive coatings business to implement management plans."

NPAC's organizational structure as of October 1, 2020

From January 1, 2021 (planned)

※According to the new structure that will be launched on January 1, 2021, Japan Paint Automotive Coatings ("NPAC") will become the headquarters. The registered company name will remain unchanged.

Ownership structure of Nippon Paint Holdings Limited

DSM sells coating resin and functional materials business

On September 30, Covestro and DSM Group signed an agreement to acquire its resin and functional materials business (RFM). Covestro agreed to purchase at a price of 1.61 billion euros (approximately US$1.886 billion) and will combine equity and debt financing. The transaction is expected to be completed in the first quarter of 2021, and requires regulatory approval, including antitrust licenses.

It is understood that this transaction will include the entire business of the DSM resin and functional materials division, including DSM iaga®, DSM Additive Manufacturing and DSM Advanced Solar's coatings business. These businesses have net sales of 1.012 billion euros in 2019 and EBITDA of 133 million euros.

BASF completes sale of construction chemicals business

On September 30, BASF announced that it had closed the divestiture of the construction chemicals business and divested it to an affiliate of the global private equity firm Lone Star. The purchase price on the basis of cash and debt is 3.17 billion euros (approximately 3.713 billion US dollars).

It is reported that BASF's construction chemicals business has approximately 7,500 employees, has production bases and sales offices in more than 60 countries/regions, and has sales of approximately 2.6 billion euros in 2019.

Hexion sells phenolic resin and European forest products resin business

On September 28th, Hexion, a global manufacturer of adhesives, coatings and composites, announced that it has reached a final agreement to sell its phenolic specialty resins, hexaamines and European forest products resins business to Black Diamond and Company for approximately US$425 million. Investindustrial. The consideration includes $335 million in cash and certain liabilities assumed, and the remainder is future income based on business performance.

In the past 12 months ending June 30, 2020, sales of these businesses totaled approximately $530 million. The transaction includes approximately 900 branches and 11 production plants around the world, producing phenolic special resins and engineering thermosetting molding compounds. Products are widely used in end markets such as construction, industry, automobiles, electronics, agriculture and consumption.