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The consolidation wave rolls on
As industry leaders pursue transformational mergers and investors return to the sector, the paints and coatings market is entering a new era of consolidation. Mega-deals, strategic repositioning and renewed investor appetite are reshaping the paints and coatings industry across the DACH region, while SMEs face mounting pressure to scale and consolidate. By Markus Loy, Loy & Co Corporate Finance.
The M&A market in the paints and coatings industry has undergone a fundamental transformation in 2025 and 2026. Following a period of relative restraint caused by high interest rates, a weakening construction sector and volatile raw material markets, we are now witnessing the return of major transactions. Several billion-euro deals are shaping the landscape: the sale of BASF’s coatings division to the international private equity investor Carlyle and the Qatar Investment Authority, the planned merger between Akzo Nobel and Axalta, and Henkel’s acquisition of coatings specialist Stahl. Meanwhile, the SME sector continues to consolidate, albeit more quietly and with less fanfare.
At the same time, the industry is coming under economic pressure. According to the German Paint and Printing Ink Industry Association (VdL), sales volumes fell by 2.8% in 2025. Architectural paints and printing inks were particularly affected. This combination clearly demonstrates that, especially during periods of economic weakness, companies seek scale, synergies and strategic repositioning. In addition, succession planning remains a ubiquitous issue, particularly among SMEs.
Three transactions dominate the landscape and will reshape the industry structure for years to come. What they all have in common is the motive of strategic realignment: away from the conglomerate model and towards either focused specialists or global scale.
BASF Coatings: A carve-out for EUR 7.7 billion
By far the largest DACH transaction in the paints and coatings sector is the sale of BASF’s coatings division to the US private equity investor Carlyle and the sovereign wealth fund of Qatar (QIA). The agreement was signed on 10 October 2025. The European Commission approved the transaction on 4 June 2026, subject to the condition that Carlyle divests the global polysulphide business of its portfolio company Nouryon (Greiz plant). Nouryon is one of only two global suppliers of polysulphides, a key raw material for aerospace sealants. Since BASF Coatings is a major sealant manufacturer and polysulphide customer, Brussels feared an anti-competitive vertical integration within Carlyle’s portfolio.
The division comprises OEM automotive coatings, automotive refinish coatings and surface treatment technologies, employing around 6,000 people. Revenue amounts to approximately EUR 3.8 billion. BASF retains a 40% stake and receives approximately EUR 5.8 billion in cash. For BASF, the transaction represents a strategic withdrawal from a coatings business closely linked to commodities; for Carlyle, it is a clear commitment to the paints and coatings industry as an attractive investment class.
Akzo Nobel and Axalta: When a Defensive Merger Turns into a Bidding Battle
Even more spectacular is the planned merger between Akzo Nobel and Axalta Coating Systems, announced on 18 November 2025. Structured as a merger of equals, Akzo Nobel shareholders will hold 55% and Axalta shareholders 45% of the combined company. With combined revenues of around USD 17 billion and estimated synergies of US$600 million, the transaction would create a genuine global leader in the coatings industry.
In April 2026, Nippon Paint and Sherwin-Williams attempted to derail the merger. Through two successive cash offers (the latest being EUR 73 per Akzo Nobel share, equivalent to a EUR 12.5 billion all-cash offer), the consortium sought to launch a hostile takeover. The plan was to break up Akzo Nobel: Nippon Paint would acquire decorative paints and industrial coatings, while Sherwin-Williams would take over automotive, marine and powder coatings. Both offers were rejected by the Akzo Nobel board on the grounds that the price did not adequately reflect the company’s value when taking Axalta synergy potential into account. On 3 June 2026, Nippon Paint and Sherwin-Williams officially announced that they were ending their efforts to acquire Akzo Nobel. This bidding contest vividly illustrates the strategic value that major listed coatings companies hold for international buyers and the willingness to pay significant premiums for them.
Read the full article in European Coatings Journal for an in-depth assessment of the transactions, market dynamics and strategic considerations shaping chemicals and coatings M&A. You can can find out more about:
- the acquisition of Stahl by Henkel, as well as the quieter but strategically important consolidation among SMEs in the DACH region;
- current valuation levels for large transactions and mid-sized coatings businesses, including the factors that support premium EBITDA multiples;
- the most active strategic and financial buyers in the DACH market, and why 2026 and 2027 could provide a particularly attractive window for well-prepared sellers.
