Listed Japanese paint and coating manufacturer Kansai Paints has acquired a 90 per cent stake in Sadolin Group for $100 million (Sh10.3 billion).
The regional acquisition leaves local shareholders holding the balance of shares.
The Tokyo Stock Exchange-listed company’s South African subsidiary, Kansai Plascon, on Tuesday said the acquisition includes Rwanda, Tanzania, Uganda and Kenya operations.
The firms pay royalties to Sadolin Group, owned by Dutch multinational Akzo Nobel, to use the brand name. The Dutch earlier said the franchise expires February next year.
“We have retained the current management, the leadership in business for a two-year period. We will work closely with the local leadership and after the two years, we’ll then decide whether to acquire the balance or the local shareholder will retain the 10 per cent in the Sadolin business,” said Gary Van Der Merwe, president-Kansai Plascon East Africa Ltd, during a press briefing in Nairobi.
The Osaka-based Kansai Paints has 14 manufacturing sites across Africa and with the new acquisition the number now rise to 18.
In May, Kansai Paints 2016 fiscal year results briefing noted Sadolin Group recorded sales of $85.5 million (Sh8.8 billion) in 2015, with an operating profit of $13.7 million (Sh1.4 billion).
The Osaka-based firm said Africa is one market that is expected to expand with respect to long-term demand for coating materials.
Kenya’s Competition Authority authorised the takeover last May.