JSW Paints’ Strategic Acquisition of Akzo Nobel India: A Major Deal in the Indian Paints Sector

INTRODUCTION 

In 2025, India’s paints and coatings industry witnessed a landmark transaction as JSW Paints Limited (“JSW Paints”) entered into definitive agreements to acquire a 74.76% majority stake in Akzo Nobel India Limited (“ANIL”). This deal represents one of the largest consolidation moves in the country’s decorative and industrial paints sector, marking a pivotal strategic expansion for JSW Paints.

A part of the diversified JSW Group, JSW Paints has rapidly emerged as a dynamic player in India’s decorative and industrial paints market since its inception in 2019. ANIL, a publicly listed subsidiary of the global coatings leader Akzo Nobel N.V., has a longstanding presence in India and is renowned for its premium Dulux brand in decorative paints, along with a robust portfolio in industrial coatings.

STRUCTURE OF THE DEAL 

In June 2025, JSW Paints, a unit of the diversified JSW Group, signed definitive agreements to acquire up to 74.76% of ANIL from Akzo Nobel N.V. and its affiliates i.e, Akzo Nobel Coatings International B.V. and Imperial Chemical Industries Limited (collectively “Affiliate Entities”), for a maximum consideration of USD 10,452 million, subject to adjustments and regulatory approvals.¹ The CCI approved the acquisition of up to a 75% stake in ANIL, clearing a key regulatory hurdle for the transaction.² As of 10 December 2025, JSW Paints completed the acquisition of a 60.76% stake from Akzo Nobel N.V. and its Affiliate Entities and an additional 0.44% through an open offer, bringing its total holding in ANIL to 61.2%.

KEY LEGAL CONSIDERATIONS

1. CCI Approval: The acquisition was subject to mandatory approval from the CCI under the Competition Act. CCI’s order covers the proposed combination implemented through a share purchase agreement and a mandatory open offer, following the parties’ filing under the Competition Act and the relevant rules and regulations. In its assessment, the CCI evaluated the deal’s potential competitive effects in the decorative and industrial paints segments and concluded that the transaction would not have an appreciable adverse effect on competition in the Indian paints sector, thereby allowing the acquisition to proceed.³

2. SEBI approval:  Since the acquisition involved JSW Paints acquiring more than 25% of the voting rights in ANIL, it triggered mandatory open offer obligations under Regulation 3(1) and 4 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (“SAST Regulations”). Accordingly, the JSW Paints made a public announcement,⁴ filed a Draft Letter of Offer with SEBI⁵ through its merchant banker, and completed the open offer process following SEBI’s observations, alongside making requisite disclosures to the stock exchanges under the SEBI LODR Regulations. The company duly reported the share transaction to the stock exchanges in line with SEBI (Prohibition of Insider Trading) Regulations, 2015.⁶  

In its disclosure dated 10 December 2025, ANIL reported compliance with SEBI’s Listing Obligations and Disclosure Requirements, noting that JSW Paints intends to be classified as a promoter, while the existing promoters plan to cease their promoter status upon completion of the share purchase agreement.

3. Tax Implications: Article 13⁷ of the India-Netherlands Double Tax Avoidance Agreement (“DTAA”) deals with the taxation of “capital gains” arising from the sale of shares. Based on a reading of Article 13, where a non-resident alienates shares of a company resident in the other contracting state and such shareholding represents at least a 10% interest in the capital of that company, the source state is permitted to tax the gains if the transfer is made to a resident of that source State. In the present context, since ANIL is an Indian company, and Akzo Nobel N.V. and its Affiliate Entities (being non-residents) sold a stake in excess of the 10% threshold, Article 13 permits India to tax the capital gains arising from this sale. This is because the shares of an Indian company were sold directly to JSW Paints, an Indian buyer. Although, Article 13 also provides an exception under which capital gains would not be taxable in India if the transfer takes place as part of a corporate reorganisation, such as a merger, amalgamation, demerger, or internal group restructuring. However, this exception does not apply to the transaction, as the deal was a straightforward sale of shares for cash consideration through a share purchase agreement. That said, the precise tax treatment will ultimately depend on the final position adopted by the tax authorities, details of which are not yet publicly available.

OUR THOUGHTS

While the bulk of the acquisition has been completed, JSW Paints retains the flexibility to increase its shareholding up to the initially agreed 74.76%, subject to applicable regulatory thresholds and market conditions. The long-term success of the transaction will depend not merely on ownership consolidation but on JSW Paints’ ability to seamlessly integrate ANIL’s operations, preserve the strength and premium positioning of established brands such as Dulux, and deploy capital efficiently across manufacturing, distribution, and innovation. 

The information contained in this document is not legal advice or legal opinion. The contents recorded in the said document are for informational purposes only and should not be used for commercial purposes. Acuity Law LLP disclaims all liability to any person for any loss or damage caused by errors or omissions, whether arising from negligence, accident, or any other cause. 

1. Press Release by JSW Paints (27 June 2025) (can be accessed here at jsw.in/news/jsw-paints-signs-definitive-agreements-to-acquire-akzo-nobel-india-in-a-strategic-move-to-grow-in-indias-paints-industry/). ↩︎
2. Press Release by Competition Commission Of India (16.09.2025) can be accessed here at Press Release:Press Information Bureau) ↩︎
3. Competition Commission of India Order (16.09.2025) (can be accessed here at Competition Commission of India, Government of India). ↩︎
4. Public Announcement (27.06.2025) (can be accessed here at Akzo Nobel India Limited_PA_p.pdf) ↩︎
5. Draft Letter of Offer (11.07.2025) by JSW Paints can be (accessed here at Akzo Nobel India Limited_DLOO_p.PDF) ↩︎
6. Disclosure under Regulation 31A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 by AkzoNobel (can be accessed here at 4d7b2bf8-fee9-4192-8fe4-766d87fc68be.pdf) ↩︎
7. Article 13 of the India-Netherlands Double Tax Avoidance Agreement (can be accessed here at Netherlands Comprehensive Agreements) ↩︎