The merger of two paint industry giants, Sherwin-Williams and Valspar, has raised antitrust concerns this month
North American paint industry leader Sherwin-Williams has been in the news again this month. The company is going ahead with its acquisition of Valspar, a business that supplies B&Q here in the UK. Sherwin-Williams CEO John Morikis is pushing the deal which is hoped will give his company access to European and Asian markets.
The deal is said to be worth a wapping £6.5 billion. Not surprisingly Valspar shares hit an all time high with the news. However the deal has yet to be approved and investors voiced concern. This will be by far the biggest deal Sherwin-Williams has ever been involved with. Valspar is about half the size in terms of sales.
Said Morikis in a recent telephone interview :
This accelerates the strategy we have long had in place, Valspar is a company we have long admired.
You will see a slogan on the Sherwin-Williams logo “cover the earth”. However the company has only just about covered North America up until now. Valspar has a larger presence globally especially in the industrial sector of the market. The two businesses will therefore compliment each other if the deal goes ahead. Asia is where all the growth is right now and Sherwin-Williams are particularly keen to get a foot hold in China. Time will tell for sure.
Said Mike Harrison, an analyst at Seaport Global Securities :
Where they have a very strong presence is with the paint contractors, the kind of the local store no matter where you’re doing a job…
For more about this story visit the Chicago Tribune.