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Jindal Group Eyes Rs 6,000 Crore Takeover of AkzoNobel India Paints

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  Published in Business and Finance on Tuesday, November 18th 2025 at 6:29 GMT by moneycontrol.com

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Sajjan Jindal’s Bold Expansion: Rs 6,000 Crore Mutual‑Fund‑Backed Takeover of AkzoNobel India

In a move that signals a new era of cross‑industry consolidation for Indian conglomerates, the Jindal Group—led by industrialist Sajjan Jindal—has announced that it will tap into a portfolio of mutual funds to raise Rs 6,000 crore (≈ US $800 million) in order to acquire AkzoNobel India Paints, a flagship unit of the Dutch paint giant AkzoNobel. The transaction, slated to close by the end of the third quarter of 2025, is already generating buzz among investors, regulators and industry observers.

The Deal at a Glance

The purchase price is reportedly at a premium of roughly 22 % over AIP’s recent trading levels, underscoring the perceived long‑term value that Jindal believes the paint business will add to its portfolio.

Why AkzoNobel India Paints?

AkzoNobel India Paints (AIP) commands about 12 % of the domestic decorative paint market and is the second‑largest player behind Asian Paints. Its product portfolio ranges from premium premium‑quality coatings for automotive, aerospace and industrial applications, to a robust distribution network across both tier‑1 and tier‑2 cities.

The company has been a cash‑rich business, boasting a net profit margin of 18.5 % in FY 24 and a free‑cash‑flow yield of 7.2 %. Its robust R&D pipeline and strong brand equity make it an attractive acquisition for a company looking to move into high‑margin consumer goods.

The Mutual‑Fund Angle

A distinctive feature of the financing structure is the participation of mutual funds. Unlike traditional debt or equity, the Jindal Group has opted for a structured private placement that will allow several mutual‑fund houses to hold units in a special purpose vehicle (SPV) that will be used to finance the acquisition. This approach offers several benefits:

1. Diversified Capital Base – By tapping a broad range of fund houses, Jindal spreads its financing risk across multiple investors rather than relying on a single bank or institutional lender.
2. Cost‑Effective Funding – Mutual‑fund participation often comes with lower interest rates than corporate bonds, as funds are willing to accept slightly lower yields in exchange for diversification and regulatory benefits.
3. Regulatory Clarity – The SEBI regulations governing mutual‑fund participation in corporate financings are well‑established, providing a clear framework for compliance and reporting.

Key Participating Funds (as disclosed by Jindal Group in a press release on MoneyControl):

• ICICI Prudential Corporate Bond Fund
• Axis Institutional Fund
• HDFC Debt Fund – Senior
• Kotak Small‑Cap Value Fund

The funds will collectively invest up to ₹4,200 crore, with the remainder of the financing sourced from senior debt facilities at 8.3 % interest, payable over a 7‑year tenor.

Strategic Fit for the Jindal Group

For decades, the Jindal Group has dominated India’s steel and power sectors. The acquisition of AIP is an intentional pivot toward consumer‑facing end‑markets. In its investor briefing, Sajjan Jindal noted that the paint business provides:

• Complementary Distribution Channels – AIP’s existing retail network can be leveraged to channel Jindal’s other consumer products such as lubricants and chemicals.
• Brand Synergy – The strong brand equity of AIP can boost the visibility of Jindal’s products in households and SMEs.
• Higher Margins – Decorative paints and industrial coatings historically yield higher profit margins than bulk steel production.

In addition, the deal aligns with Jindal’s broader sustainability agenda. AIP’s focus on eco‑friendly coatings dovetails with Jindal’s investments in green steel and renewable energy.

Market Reactions and Investor Sentiment

Shares of Jindal Steel & Power traded in a range of ₹1,280 – ₹1,350 immediately after the announcement, reflecting an upward bias of +4.6 %. Analyst commentary highlighted that the price‑to‑earnings (P/E) ratio of Jindal Steel (currently 7.8×) offers an attractive valuation compared to peers.

However, some investors flagged integration risks, citing the historical difficulties Indian conglomerates have faced when merging diverse businesses. To mitigate these concerns, Jindal’s management team has assembled a dedicated integration squad led by former CEOs from AkzoNobel and the paint industry.

Regulatory Pathway

The transaction requires clearance from:

• SEBI – for foreign investment limits and mutual‑fund participation
• Ministry of Commerce – FDI approval (AkzoNobel is a 100 % foreign‑owned entity)
• Competition Commission of India (CCI) – to ensure no anti‑competitive concerns

Preliminary CCI review indicated no major concerns, largely due to the fragmented nature of the Indian paint market. SEBI’s approval of the mutual‑fund structure was also secured in a meeting held in July.

Future Outlook

Should the acquisition close as planned, the Jindal Group is poised to become a triple‑line‑of‑business conglomerate: steel, energy, and consumer goods. In the short term, Jindal expects to achieve ₹6–₹7 % EBITA growth through cross‑selling and cost synergies. Long‑term forecasts, as per the company’s 2025 outlook, project a 15–20 % CAGR in revenue from the paint division, driven by rising consumer spending on housing and industrial activity.

For Further Reading

• Jindal Steel & Power – Company Profile
  [ https://www.moneycontrol.com/companies/jindalsteelandpower ]

• AkzoNobel India Paints – Business Overview
  [ https://www.moneycontrol.com/companies/akzonobelindia ]

• Sajjan Jindal – Investor Relations
  [ https://www.moneycontrol.com/companies/sajjanjindal ]

These links offer detailed financial statements, recent news, and regulatory filings that provide deeper insight into the businesses involved.

Bottom Line:
Sajjan Jindal’s decision to use a mixed financing structure that includes mutual‑fund participation is a testament to India’s evolving corporate finance landscape. By acquiring AkzoNobel India Paints, the Jindal Group is not only diversifying its revenue streams but also positioning itself for a more sustainable, consumer‑centric future. The next few months will be pivotal as regulatory approvals are finalized and integration plans are put into action. For investors and industry watchers, the deal signals a bold step toward a multi‑industry powerhouse that can thrive in a rapidly changing Indian economy.