Singapore paint giant Wuthelam Holdings recently announced that it will spend up to 1.29 trillion yen (approximately S$16.7 billion) to increase its stake in Nippon Paint Holdings, a Japanese paint holding company, which will become this year. One of the largest cross-border equity transactions in Asia.
Wu Denan Group is currently the largest shareholder of Nippon Paint Company, holding approximately 40% of Nippon Paint's shares. The acquisition will implement a third-party targeted additional issuance, which will be fully subscribed by Wu Denan Group. After the capital increase, Wu Denan Group’s shareholding with voting rights will increase from the current 39.5% to about 55.1%. The share subscription plan is to be completed on January 1 next year.
Since 1962, Wu Denan Group has cooperated with Nippon Lacquer to become its sales agent in Asia. The two parties have also established joint ventures in Thailand, Malaysia, China and other Asian regions. Up to now, there have been more than 50 years of cooperation.
Since 2013, Wu Denan Group has begun to work hard to obtain a multi-digital numerical control stake in Nippon Lacquer. At that time, the controlling stake increased from 14.5% to 38.9%.
After the completion of this equity subscription plan, Nippon Paint will use the funds raised to acquire its joint ventures in China, India, Malaysia, Singapore, South Korea and Thailand. In addition, Nippon Paint will acquire Wu Denan Group’s wholly-owned company in Indonesia for approximately US$2 billion (approximately S$2.7 billion).
According to the Nikkei Chinese website, after the news of the equity trading plan was reported, Nippon Paint's share price rose 5.1% in the afternoon trading in Tokyo.
Nippon Paint is now the largest company in the domestic coatings industry in Japan, and the Wu Denan Group is an enterprise group founded by Singaporean Goh Cheng Liang, who is originally from Guangdong. In addition to the coating business, it is also involved in real estate and investment businesses.
Wu Qingliang is also the founder of Nipsea, the largest paint manufacturer in Asia. The 93-year-old "coating tycoon" ranked third among the rich Singaporeans released by Forbes Asia yesterday, with his net asset value increasing from US$9.5 billion last year to US$14.8 billion.
