Wall Street recognises Kansai’s acquisition of Freeworld as a “deal of the year”
Nortons Inc. represented Freeworld Coatings Limited (“Freeworld”), in the hostile takeover bid by the Japanese multinational company Kansai Paint Company Limited (“Kansai”), in proceedings before the South African competition authorities. The transaction was subsequently recognised as “deal of the year” on Wall Street, in the category for deals valued between US$100 million and US$500 million. The proposed transaction entailed Kansai acquiring the remaining shares 72.44% shares in Freeworld, which it did not already own, and thereby acquiring the remaining 72.44%, and thereby acquiring control over Freeworld. Freeworld manufactures decorative coatings, and supplies automotive coatings to original equipment manufacturers and automotive refinish coatings in South Africa. It is the only remaining local manufacturer of these products in South Africa. Kansai manufactures decorative coatings and automotive refinish coatings internationally and supplies automotive coatings to original equipment manufacturers in South Africa and abroad. Freeworld raised a number of serious competition and public interest concerns that appeared to arise as a result of the proposed transaction. The South African competition authorities approved the transaction subject to conditions, including the divestiture of the automotive coatings division of Freeworld, as well as the most far-reaching public interest conditions imposed on a South African merger to date. Kansai appealed against the Competition Commission’s (the “Commission”) decision to approve the takeover subject to the divestiture condition. Nortons Inc. represented Freeworld in proceedings before the Commission.