Durability + Design
Follow us on Twitter Follow us on LinkedIn Like us on Facebook Follow us on Instagram Visit the TPC Store
Search the site

 

D+D News

Main News Page


Vanlancker Inherits Akzo, Initiatives Post-Büchner

Thursday, July 20, 2017

More items for Good Technical Practice

Comment | More

Early Wednesday morning (July 19) global paint and coatings firm AkzoNobel (Amsterdam) announced that CEO Ton Büchner has stepped down effective immediately, citing medical reasons.

Photos courtesy of AkzoNobel unless otherwise noted

CEO Ton Büchner has stepped down effective immediately, citing medical reasons.

"For me this was an extraordinarily difficult decision to make but my focus must now be on my health,” Büchner said in a statement. "It was a privilege to work for AkzoNobel, and I am extremely proud of all the achievements the team delivered during my five years at the company.”

Büchner became the chief executive in 2012, leading the company through various initiatives and increasing margins. His tenure included the sale of AkzoNobel's North American Decorative Paints business to PPG in 2013 and the purchase of BASF's Industrial Coatings unit for $531 million in early 2016. Perhaps most notably of late, Büchner handled, and turned down, multiple merger proposals from rival PPG Industries (Pittsburgh).

What Happens Now

According to AkzoNobel, Thierry Vanlancker, head of the company's Specialty Chemicals business, will take over as CEO of the firm effective immediately. Vanlancker has led AkzoNobel Specialty Chemicals since 2016; he previously was employed by DuPont and DuPont spinoff Chemours. He joined DuPont in 1988 and held a number of senior positions.

Thierry Vanlancker, head of the company's Specialty Chemicals business, will take over as CEO of the firm effective immediately.

A Belgian national, prior to joining AkzoNobel Vanlancker was president of Fluoroproducts for Chemours, the spin-off company of DuPont's chemical businesses that formed in 2015.

''AkzoNobel remains focused on delivering for our customers every day,” said the chairman of AkzoNobel's supervisory board, Antony Burgmans. “In Thierry Vanlancker we have an outstanding executive who is well placed to continue building momentum for the company. This includes the creation of two focused businesses, delivering sustainable growth and profitability. "

Vanlancker is now tasked with completing the spin-off of the Specialty Chemicals business and hitting the ambitious targets that the company set forth in the spring.

During the 2017 Q1 earnings meeting in mid-April the company reported record profitability and highlighted the achievements that it hopes the spin-off will render.

Specialty Chemicals Plan

The plan is to sell or list the chemicals business (which accounts to about a third of sales and profits) within the next year, as project teams are already in place. According to Reuters, analysts have valued the division at approximately 8 billion euros, based on the company’s 2016 operating profit of 629 million euros.

The company estimates about 150 million euros in annual savings from its continuing improvements to Paints and Coatings programs plus an additional 50 million euros in savings expected from the separation of the Specialty Chemicals line.

Vanlancker is now tasked with completing the spin-off of the Specialty Chemicals business and hitting the ambitious targets that the company set forth in the spring.

AkzoNobel said it estimates that its 2017 EBIT will be around 100 million euros ahead of 2016 due to growth momentum across all platforms, and reiterated the increased shareholder returns generated from the separation plan, which included:

  • A 50 percent increase to the regular dividend per share to 2.50 euros per share, reinforcing confidence in the future plan to further drive growth and profitability;
  • Vast majority of net proceeds from the separation of Specialty Chemicals to be returned to shareholders; and
  • A 1 billion-euro special dividend to be paid in November reflecting confidence in the planned separation.

Carbon-Neutral Goals

In addition to the EBIT goals connected to the separation of companies, Vanlancker is also saddled with staying on course with the most ambitious renewable energy goal ever made by a major paints and coatings manufacturer.

"Our ambition to eliminate carbon emissions and use 100 percent renewable energy by 2050 demonstrates our clear and unwavering commitment to sustainability," Büchner said when the goal announcement was made in March.

Vanlancker is also saddled with staying on course with the most ambitious renewable energy goal ever made by a major paints and coatings manufacturer.

"We continue to identify areas of opportunity which will drive us forward and help reduce our industry's dependence on fossil fuels. This new vision for 2050 will propel us further along that path, while enabling us to make a measurable contribution to the United Nations Sustainable Development Goals."

The company’s views and goals regarding sustainability was a point that Büchner pointed to throughout the multiple rejections of merger proposals by PPG, citing a “significant culture gap between both companies.”

PPG Bids

PPG officially pulled its offer off the table on June 1 after three bids were made in less than three months.

The final offer came on April 24, which the company said it would consider. On May 8, AkzoNobel announced it had rejected the bid. PPG refuted AkzoNobel’s claims that the two companies had met to discuss the offer.

PPG officials said that AkzoNobel called a last-minute meeting in Rotterdam on less than 24 hours’ notice, and that Büchner and Burgmans refused to negotiate. PPG said the refusal to negotiate represented a “continued lack of proper governance” at AkzoNobel.

PPG Industries

PPG officially pulled its offer off the table on June 1 after three bids were made in less than three months.

That proposal came in at 96.75 euros per outstanding ordinary share of AkzoNobel, bringing the total offer to about $28.8 billion. PPG’s first and second offers, of $22.8 billion and $26.3 billion, were both rejected outright.

In May, PPG made a public announcement that the offer was still on the table, and some thought the company would go for a hostile takeover, which did not happen.

When asked about Büchner’s resignation, a spokesperson at PPG declined to comment. Because of laws in the Netherlands, PPG would have to wait until November if it wanted to make another bid for a merger.

Shareholders v. Burgmans

While many analysts think an upcoming offer from PPG is unlikely, according to Reuters, Vanlancker will still have fallout to deal with from all of those proposals.

Some shareholders attempted to get AkzoNobel to the bargaining table: Fund manager Tweedy, Browne Company LLC wrote a letter to the company’s supervisory board criticizing its inaction, and Elliott Advisers moved to try to remove Burgmans via a legal challenge in the Enterprise Chamber Court of the Netherlands.

World Economic Forum, CC BY-SA 2.0, via Wikimedia Commons

Elliott Advisors is part of Elliott Management, founded by billionaire investor Paul Singer.

Since then, however, Elliott Advisers has filed another suit, this time in the Interim Relief Court in Amsterdam, which is slated to be heard within the next several weeks. The motive is still to remove Burgmans from his position as supervisory board chair.

"Elliott finds Chairman Burgmans’ views on shareholder democracy to be archaic and wholly unacceptable in today’s capital markets," the firm reportedly said in a statement. "A board which holds itself accountable to no one is not an appropriate governance paradigm. If shareholders are not able to regulate the conduct of Akzo Nobel's boards, who can?"

Burgmans’ four-year tenure expires next spring.

The Immediate Future

AkzoNobel is set to report its Q2 earnings next week, July 25, with Vanlancker leading the media call. Its shares traded flat at 77.96 euros in mid-morning trade on Wednesday (July 19).

AkzoNobel reported 14.2 billion euros in revenue in 2016; the Dutch firm was the world's second-largest coatings company, after PPG, last year, prior to the Sherwin-Williams Company acquisition of Valspar.

   

Tagged categories: AkzoNobel; Business matters; Personnel; Personnel changes; PPG; Ton Buchner

Comment Join the Conversation:

Sign in to our community to add your comments.

Advertisements
 
Novatek Corporation
 
Novatek Portable Air Filtration Systems
 
Air Scrubbers/Negative Air machines for restoration, abatement, dust & odor control, hazardous contaminant removal from job sites to clean rooms and hospitals. Portable, affordable!
 

 
Shield Industries, Inc
 
FireGuard® E-84 Intumescent Coating - Shield Industries, Inc
 
Trust the certified protection of the industry’s most innovative intumescent coating FireGuard® E-84 to provide you with the 1 and 2 hour fire ratings you need.
 

 
Keim Mineral Coatings
 
Mineral Silicate Paints + Stains Fuse to Concrete
 
• Forms permanent chemical bonds
• Becomes part of the concrete
• Will never peel
• Looks completely natural
 

 
 
 

Technology Publishing Co., 1501 Reedsdale Street, Suite 2008, Pittsburgh, PA 15233

TEL 1-412-431-8300  • FAX  1-412-431-5428  •  EMAIL webmaster@durabilityanddesign.com


The Technology Publishing Network

Durability + Design PaintSquare the Journal of Protective Coatings & Linings Paint BidTracker

 

© Copyright 2012-2018, Technology Publishing Co., All rights reserved