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European Merger To Create World’s Largest Paint Maker

November 9, 1993

AMSTERDAM, Netherlands (AP) _ Dutch Akzo NV and Sweden’s Nobel Industries announced a merger creating the world’s largest producer of paints and other coverings.

The new chemicals giant, called Akzo Novel, will be worth an estimated $11.17 billion. The companies said the merger will enable them to compete in a fast-changing world market.

Arnhem-based Akzo will pay an estimated 3 to 4 billion guilders ($1.5 billion to 2 billion) for Stockholm-based Nobel in the deal announced Monday.

Akzo said that it will swap two newly issued Akzo common shares for every 57 Nobel common shares held.

Akzo will also pay shares and cash for Nobel’s preferred shares outstanding. The Dutch company plans to raise 1.3 billion guilders ($690 million) via a separate stock sale to institutional investors to help fund the Nobel deal.

But because Akzo shares being issued for tender offer are not eligible for sale in the United States or to Americans, Nobel’s U.S. shareholders will be offered the alternative of receiving 26.50 Swedish kronor, or $3.26 a share cash for their stock.

Akzo shares are traded on the Nasdaq Stock Market in the United States.

Akzo also plans to list the post-merger shares on the Stockholm exchange.

The merged company’s other business line will include specialty and basic chemicals, salts, pharmaceuticals, fibers, and chemicals for the paper industry.

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