Nippon Paint acquires Alina Group

Competing for the global market worth hundreds of billions, global paint giant Nippon Paint has won another company with an annual revenue of nearly 1 billion.

On November 13, Nippon Paint announced that its joint subsidiary Nippon Paint Holdings SG Pte. (NPHDSG) has acquired 75% shares of Alina Group, which is engaged in the manufacturing and sales of dry-mix mortar materials, coatings, etc. in Kazakhstan.

Nippon Paint said that the two parties have signed a share transfer contract. In addition, at the same time as signing the share purchase agreement, Nippon Paint also signed a put and call option agreement, which gives NPHDSG the right to purchase the remaining 25% of Alina's share capital after reaching an agreement with the seller within three years or earlier.

At the board meeting held on August 10, 2023, Nippon Paint's board of directors decided to entrust the decision-making power of signing the share purchase agreement to the representative executive officer and co-president. As all conditions have been met, the company officially signed the share purchase agreement on November 11, 2023.

It is understood that Alina was founded in 2000 and is located in Almaty, Republic of Kazakhstan. The company focuses on manufacturing and selling dry mortar materials and coatings. From 2020 to 2022, Alina's sales were US$95.6 million, US$121 million, and US$130 million respectively.

Nippon Paint stated that the company has always been pursuing maximization of shareholder value (MSV) as its sole mission, implementing good low-risk mergers and acquisitions through the asset integration model, thereby improving performance, accumulating newly acquired brands and human resources, and building a solid foundation within the group.

In addition, the company is advancing a strategy to expand its business areas and expand its business scope from the paint and coating fields to adjacent fields in the medium to long term. The global market size of CC (Construction Chemicals) in the coating peripheral field is US$72 billion, and Nippon Paint is establishing a solid foothold in various regions to increase market share.

Central Asia, including Kazakhstan, has the potential to achieve continued strong growth driven by GDP growth and urbanization. Alina operates in four countries in Central Asia, centered on Kazakhstan, and has a leading position in the dry-mix mortar market (CC segment in Kazakhstan) and the paint and coatings market, with high brand awareness, a well-established production base and an extensive distribution network.

The share acquisition will enable Nippon Paint Group to leverage Alina’s accumulated expertise. In addition, Nippon Paint will work to expand the company's business in neighboring regions and increase the company's market share in the Central Asian market by establishing synergies with group companies, for example, Nippon Paint's Turkish consolidated subsidiary Betek Boya supplies the Kazakhstan market with brands with a wide range of price points to improve product offerings.