Nippon Paint Holdings Co. said Friday that Singapore'sWuthelam Holdings Group will take a majority stake in it, in a 1.29 trillion yen ($12 billion) deal, as they look to deepen their decades-long partnership to meet growing demand in Asian markets.
Wuthelam, Nippon Paint's top shareholder, will raise its stake to 58.7 percent from the current 39.6 percent via a third-party share allotment to be completed on Jan. 1 next year.
Nippon Paint, the world's fourth-largest paint maker by sales and headquartered in Osaka Prefecture, has been working with paint manufacturer Wuthelam since the 1960s in Asian markets, particularly in Southeast Asia.
In a rare acquisition of a Japanese firm by a company in another Asian country, Nippon Paint will come under the wing of Wuthelam to bolster their Asian operations and better compete against U.S. and European rivals.
The latest deal follows Sharp Corp., a household name in Japan, being brought under the group of Taiwan'sHon Hai Precision Industry Co. in 2016.
Under their operation reforms, the Japanese paint maker, which has strength in paints for industrial and auto use, will take full control of Wuthelam's Indonesian business as well as their joint ventures in China, South Korea, Taiwan, Malaysia and Singapore.
In 2013, Wuthelam sought to strengthen its tie-up with Nippon Paint by raising its stake to around 45 percent but later gave up on the bid to avoid damaging their ties.
To gain a stronger foothold overseas, Nippon Paint acquired Australian peer DuluxGroup Ltd. and Turkey's Betek Boya ve Kimya Sanayi Anonim Sirketi A.S. in 2019.
Nippon Paint reported a 36.72 billion yen net profit in 2019 on sales of 692 billion yen.
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