Akzo Nobel is to sell its Coating Resins business to fast-expanding company Nuplex Industries

Dutch chemicals group Akzo Nobel is to sell its Coating Resins business to fast-expanding New Zealand resins and waste management company Nuplex Industries for €110m.

Akzo Nobel chairman Hans Wijers said the transaction would complete a major round of divestments in chemicals that will, at closing, generate approximately €1bn. ‘The proceeds will be used to reduce debt and to boost the growth areas of our portfolio that meet our financial criteria,’ said Wijers.

The divestment covers the entire business including shareholdings in two consolidated joint ventures in Malaysia and Indonesia and a non-consolidated joint venture in Thailand. All 850 Coating Resins employees, of which about a third are located in the Netherlands, will transfer with the business. Other major employment centres are the UK and US.

Last year the Coating Resins business had sales of €256m. These figures exclude the UV/EB Resins business, which Akzo Nobel is to sell to Cray Valley, and the Printing Ink Resins unit, which has been merged with Akzo Nobel’s Pine Specialties business and now operates as Ink and Adhesive Resins.

Nuplex has made a number of acquisitions in recent months and has made significant investments in China. Akzo Nobel raised its full-year outlook, but cautioned that raw material prices remained high as it delivered stronger than forecast third-quarter profits.

The company warned that rising raw material prices, notably oil, were weighing heavily on its coatings and chemicals divisions. The group reported an 8% rise to €329m in third quarter operating profits and a 20% rise to €213m in net income excluding non-recurring items, despite a 2% decline in sales to €3.18bn.