Dunn-Edwards
Finance and M&A Strategies
M&A Strategy
We will further accelerate EPS compounding by leveraging the competitive advantages of our Asset Assembler model and actively pursuing M&A opportunities.
Positioning M&A as One of the Pillars of Our Growth Strategy
We position low-risk and safe M&A as one of the pillars of our growth strategy. By allocating cash generated by our existing businesses to high-quality assets that contribute to Maximization of Shareholder Value (MSV), we drive inorganic growth.
M&A is not an end in itself. We maintain strict discipline over acquisition prices and, following acquisition, respect the autonomy of each partner company to unlock its full potential. Through the twin engines of organic growth and M&A, we aim to deliver sustainable compounded EPS growth.
Year 1
EPS accretion from the first year of acquisition
Within c. 3 years
Capital efficiency with ROIC exceeding WACC
MSV
Emphasis on sustained contribution to the Group
Two Pillars of M&A
Our M&A strategy consists of two pillars: bolt-on acquisitions led by partner companies and asset-assembly acquisitions pursued by Nippon Paint Holdings, the holding company.
Bolt-on Acquisitions
These transactions are led by partner companies, with the primary aim of expanding existing businesses and creating synergies. Transactions below a certain size can be approved by the respective partner companies, enabling rapid decision-making and execution.
- Prioritize the creation of synergies
- Expand existing businesses and enter neighboring markets
- Enter new business fields and pursue operational improvements
- Reflect only quantifiable and achievable synergies in valuations
Asset-Assembly Acquisitions
These transactions target relatively large companies that can generate sufficiently attractive returns even without synergies. To eliminate management ego, valuations do not assume synergies; however, after acquisition, we actively pursue synergies by leveraging the Group platform.
- Target relatively large companies
- Secure attractive returns without relying on synergies
- Do not justify high valuations with assumed synergies
- Pursue growth opportunities through Group collaboration after acquisition
Rigorous Acquisition Criteria and Our Strengths
We have refined our former “no-limit” approach and now focus primarily on the chemical domain. We carefully select companies operating in markets with solid growth prospects, possessing clear competitive advantages, and capable of achieving further growth as part of our Group.
Acquisition Criteria and Targets
- Markets where solid and reliable growth is expected
- Competitive advantages such as outstanding management, strong margins, and robust cash flow
- EPS accretion from Year 1
- Valuation expected to achieve ROIC > WACC within approximately three years
- Sustained contribution to the Group
Our Four Strengths
- Ability to carefully identify high-quality targets
- Management model that preserves autonomy and accountability after acquisition
- Systems that maintain and enhance the motivation of talent joining the Group
- Financial foundation that enables active use of low funding costs
- Track Record and Reputation That Generate New M&A Opportunities
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Our M&A approach differs from the cost-cutting models commonly seen in Western companies. We respect the history, brands, and management teams of acquired companies and base our approach on autonomous and decentralized management, delegating authority and accountability to capable local management teams.
This track record and reputation are creating new M&A opportunities. We are seeing growing interest from growth-oriented local CEOs and owners of private companies seeking a bridge to the next generation in joining our Group. We will continue executing transactions that offer low risk and good returns while contributing to MSV.
M&A Track Record
We have continuously executed acquisitions since 2019. Many acquired companies have steadily expanded revenue, operating profit, and market share after joining the Group, with M&A continuing to contribute to EPS compounding.
Number of M&A Transactions
| Year | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|
| Number of Transactions | 4 | 4 | 8 | 9 | 5 | 2 | 6 |
* Including small-scale business acquisitions (undisclosed) across regions and business segments
M&A Contribution to Adjusted Operating Profit
| Year | Adjusted Operating Profit Total (JPY 100 million) |
of which, M&A Contribution (JPY 100 million) |
Total Growth Rate （YoY） |
M&A Contribution | Companies Acquired During the Year |
|---|---|---|---|---|---|
| 2018 | 873 | — | — | — | — |
| 2019 | 959 | 86 | 11.1% | 10.0% | DuluxGroup、Betek Boya |
| 2020 | 925 | 136 | –3.6% | 14.1% | — |
| 2021 | 1,013 | 140 | 9.6% | 15.2% | PT Nipsea、Vital Technical |
| 2022 | 1,408 | 82 | 39.0% | 8.1% | Cromology、JUB |
| 2023 | 1,815 | 13 | 28.9% | 0.9% | NPT |
| 2024 | 1,996 | 64 | 9.9% | 3.5% | Alina、NPI |
| 2025※3 | 2,742 | 553 | 37.4% | 27.7% | AOC |
- *1 M&A contribution represents earnings for the first year after acquisition
- *2 2025 figures are pro forma figures retrospectively revised following the finalization of AOC’s PPA
Four Cases Accelerating Growth
Case 1: Accelerating Bolt-on M&A at DuluxGroup
DuluxGroup completed 24 acquisitions, including Cromology and JUB, during the six years after joining our Group. This represents a significant acceleration from the nine acquisitions completed over the nine years when it was listed on the Australian Securities Exchange. Rather than imposing acquisitions, we support DuluxGroup through rational and disciplined discussions grounded in its own conviction and initiative.
2010–2019:9 acquisitions totaling approximately AUD250 million
2019–2025:24 acquisitions totaling approximately AUD2.4 billion
Case 2: Accelerating Growth of the SAF Business in the NIPSEA Group
The transfer of DuluxGroup’s Selleys brand in the SAF (Sealants, Adhesives & Fillers) business to the NIPSEA Group, which has extensive distribution networks, accelerated growth in Asia. Dialogue and rational decision-making among partner companies also contributed to the acquisition of Vital Technical in 2021 and continue to generate new growth opportunities.
2025 revenue index: 914, with 2019 set at 100 (approximately 9.1x)
Case 3: Deepening Collaboration with AOC
AOC’s management team, following completion of the acquisition in March 2025, visited Japan in September of the same year and held meetings with the Co-Presidents and management teams of partner companies. AOC shared the business systems supporting its high profitability, prompting specific questions and requests for further sessions from Group companies and marking the first step toward deeper collaboration.
Case 4: Accelerating Collaboration Across the NIPSEA Group
In April 2026, the NIPSEA Group held the LFG Excellence Award with participation from 19 regions. By recognizing outstanding initiatives and strengthening knowledge sharing and collaboration among partner companies, the Group is accelerating growth across the entire organization.
Track Record of Major Partner Companies
The table below presents the growth and market positions of major partner companies that have joined our Group since 2014. While respecting each company’s autonomy, we leverage the Group’s management resources and expertise to build growth in both high-growth and mature markets.
* Revenue and other performance figures have been updated to 2025. For more detailed performance and market information, see the Asset Management Report at the bottom of the page.
Company Name
Year of Acquisition
Country / Region
Business
Market Presence (NPHD estimates)
Growth Since Acquisition (Revenue)
Company Name
Dunn-Edwards
Year of Acquisition
2017
Country / Region
USA
Business
Decorative paints
Market Presence (NPHD estimates)
-
Growth Since Acquisition (Revenue)
- 2018
JPY44.6 bn - 2025
JPY72.3 bn
+68.2%
DuluxGroup
Company Name
DuluxGroup
Year of Acquisition
2019
Country / Region
Pacific
Business
Decorative paints and
adjacencies business
adjacencies business
Market Presence (NPHD estimates)
No.1 (Australia, Papua New Guinea)
Growth Since Acquisition (Revenue)
- 2019
JPY134.9 bn - 2025
JPY251.2 bn
+86%
Betek Boya
Company Name
Betek Boya
Year of Acquisition
2019
Country / Region
Türkiye
Business
Decorative paints and
adjacencies business
adjacencies business
Market Presence (NPHD estimates)
No.1
Growth Since Acquisition (Revenue)
- 2019
JPY28.8 bn - 2025
JPY94.8 bn
+223%
PT Nipsea
Company Name
PT Nipsea
Year of Acquisition
2021
Country / Region
Indonesia
Business
Decorative paints and
automotive coatings, etc.
automotive coatings, etc.
Market Presence (NPHD estimates)
No.2
Growth Since Acquisition (Revenue)
- 2020
JPY30.3 bn - 2025
JPY65.9 bn
+117%
NIPSEA Group(2014: consolidation; 2021: full integration)
Company Name
NIPSEA Group
(2014: consolidation;
2021: full integration)
Year of Acquisition
2021
Country / Region
Asian countries
Business
Decorative paints and
automotive coatings and
industrial coatings, etc.
automotive coatings and
industrial coatings, etc.
Market Presence (NPHD estimates)
No.1 (China, Malaysia, Singapore, Sri Lanka)
Growth Since Acquisition (Revenue)
- 2014
JPY236.5 bn - 2025
JPY887.5 bn
+275.3%
Vital Technical
Company Name
Vital Technical
Year of Acquisition
2021
Country / Region
Malaysia
Business
adjacencies business
Market Presence (NPHD estimates)
-
Growth Since Acquisition (Revenue)
-
Five Chinese automotive subsidiaries
Company Name
Five Chinese automotive
subsidiaries
Year of Acquisition
2022
Country / Region
China
Business
Automotive coatings
Market Presence (NPHD estimates)
-
Growth Since Acquisition (Revenue)
-
Cromology
Company Name
Cromology
Year of Acquisition
2022
Country / Region
Europe
Business
Decorative paints
Market Presence (NPHD estimates)
No.1 (Italy)
No.2 (France, Portugal)
No.2 (France, Portugal)
Growth Since Acquisition (Revenue)
- 2021
JPY109.1 bn - 2025
JPY153.9 bn(DGL Europe total)
+41%(DGL Europe total)
JUB
Company Name
JUB
Year of Acquisition
2022
Country / Region
Europe
Business
Decorative paints and
adjacencies business
adjacencies business
Market Presence (NPHD estimates)
No.1 in interior paints (Slovenia, Croatia, Bosnia and Herzegovina, Kosovo)
Growth Since Acquisition (Revenue)
- 2021
JPY109.1 bn - 2025
JPY153.9 bn(DGL Europe total)
+41%(DGL Europe total)
NPT
Company Name
NPT
Year of Acquisition
2023
Country / Region
Italy
Business
adjacencies business
Market Presence (NPHD estimates)
-
Growth Since Acquisition (Revenue)
- 2021
JPY109.1 bn - 2025
JPY153.9 bn(DGL Europe total)
+41%(DGL Europe total)
Alina
Company Name
Alina
Year of Acquisition
2024
Country / Region
Kazakhstan
Business
Decorative paints and
adjacencies business
adjacencies business
Market Presence (NPHD estimates)
No.1 (dry-mix mortar and paints)
Growth Since Acquisition (Revenue)
- 2024
JPY25.8 bn - 2025
JPY24.3 bn
-6%
NPI
Company Name
NPI
Year of Acquisition
2024
Country / Region
India
Business
Decorative paints and
industrial coatings, etc.
industrial coatings, etc.
Market Presence (NPHD estimates)
No.2 in decorative paints
(Tamil Nadu and Karnataka)
(Tamil Nadu and Karnataka)
Growth Since Acquisition (Revenue)
- 2024
JPY9.0 bn(two months) - 2025
JPY49.4 bn
－
NPI and BNPA combined
BNPA
Company Name
BNPA
Year of Acquisition
2024
Country / Region
India
Business
Automotive coatings
Market Presence (NPHD estimates)
No.4 in automotive coatings
AOC
Company Name
AOC
Year of Acquisition
2025
Country / Region
Americas, Europe, and Asia
Business
Specialty formulator
Market Presence (NPHD estimates)
The leader
(North America)
A leading presence
(more fragmented European market)
(North America)
A leading presence
(more fragmented European market)
Growth Since Acquisition (Revenue)
- 2025
JPY157.3 bn(10 months)
-
* Growth since acquisition figures are estimates because accounting standards and assumptions used to calculate market shares may differ between the acquisition date and the present.
* Market shares are based on NPHD estimates.
* Dunn-Edwards is compared using 2018 figures because its first year after acquisition in 2017 included only 10 months of earnings.
* DGL Europe’s 2021 figures are pro forma figures combining Cromology and JUB, converted at EUR1 = JPY138.5. The 2025 figures represent the combined performance of DGL Europe, including Cromology, JUB, and NPT.
* The 2024 figures for NPI and BNPA cover two months after acquisition; the 2025 figures are the combined results of both companies.
* AOC’s 2025 figures cover 10 months after acquisition.
* A specialty formulator designs, manufactures, and sells formulations such as unsaturated polyesters and vinyl esters for coating-adjacent products, including CASE (Coatings, Adhesives, Sealants and Elastomers), colorants, and composites used in buildings, infrastructure, transportation equipment, marine applications, and other fields.
View the Latest Performance of Each Asset Company
The Asset Management Report provides details on growth since acquisition, recent performance, and market positions.