Kansai Plascon Africa Limited, a subsidiary of the Osaka-based Kansai Paint Co, has reached a binding agreement with AkzoNobel for the full acquisition of Sadolin Paints’ operations in Uganda, Kenya, Tanzania, Zanzibar, and Burundi, according to a statement released by the company on Tuesday.
The transaction, whose value was not disclosed, is still waiting for regulatory approvals and the conclusion of “other customary conditions,” the statement said.
Additionally, Kansai is also exploring the possibility of buying Sadolin’s operations in Rwanda as part of the transaction.
Uganda Business News reported last week that Kansai Paint was looking at acquiring Uganda’s Sadolin Paints for $87.5 million (Shs314 billion) through its South African subsidiary, Kansai Plascon Africa Ltd. Sadolin Paints East African operations are subsidiaries of AkzoNobel, a Dutch paints and coatings company.
“The acquisition of Sadolin Paints is part of Kansai Paint’s global expansion strategy,” the statement released by Kansai Plascon said. “This acquisition further proves Kansai Paint’s long-term commitment to the African continent and will reinforce KPAL´s leading position in Africa and establish its presence in East Africa with a total population of circa 285 million people, representing around 24% and 9% of the total African population and GDP respectively.”
Kansai Plascon’s chief executive, Farid Masood, said the transaction is in line with the company’s vision of evolving from “a Southern African focused company to becoming a Pan African company.”
Kansai, whose share of Africa’s construction-paint market is about 40%, has been eyeing expansion on the continent since acquiring Plascon South Africa in 2011. The company’s executives have expressed desire to expand to East and West Africa, the only regions in which it currently doesn’t operate.
“Kansai’s strong brand heritage, global technical capability, and trusted performance coupled with Sadolin’s respected reputation and presence in East Africa, will definitely strengthen our position as the leading paint company in Africa, enhancing our future growth and performance,” Mr Masood said.
Sadolin Paints is the largest paint manufacturer and distributor in Eastern Africa.