CLAYTON Utz is advising Australia's biggest paints business Wattyl Limited on its proposed acquisition by major American coatings manufacturer The Valspar Corporation.
Clayton Utz national M&A practice head John Elliott is leading the firm's team advising Wattyl in its negotiations with Valspar.
But things have not been completely smooth sailing for the lawyers involved. A takeover war was set to erupt this week as Dutch giant Akzo Nobel looked set to make a rival bid.
Institutional investors on 28 June bought up Wattyl shares on expectation that Akzo Novel and even US paint manufacturer rival PPG were poised to trump the $142 million offer from the US-based Valspar Corporation.
Wattyl’s board, meanwhile, decided to recommend the Valspar bid.
Shares in Wattyl soared after the company exited a trading halt, climing 28.57 per cent to close at $1.62. It was the biggest trading day for Wattyl since March last year.
Wattyl chairman John Ingram said the deal with Valspar would enable shareholders to realise cash for their shares at a major premium to recent trading levels.
Commenting on the deal, Clayton Utz’s Elliott said: "It continues a trend of ‘agreed’ deals that have been occurring in recent times. This demonstrates the relative certainty (of a recommendation) that Boards can achieve in approaching prospective targets with a willingness to pay a significant premium."
Under the proposed scheme of arrangement, Wattyl shareholders will receive A$1.67 per fully paid share, valuing the transaction at approximately A$142 million.
Subject to obtaining the necessary approvals, Valspar should move to
outright control of Wattyl by late September.