Akzo Nobel CFO eyes broad range of M&As; no contact with equity funds UPDATE

Akzo Nobel CFO eyes broad range of M&As; no contact with equity funds UPDATE

	Published : Tue, 24 Apr 2007 11:26 By : Agencies Print this Story

(Updates with more details throughout))

AMSTERDAM (Thomson Financial) - Akzo Nobel NV chief financial officer Rob Frohn said the Dutch chemicals and coatings company is looking at a broad range of acquisitions at its Coatings unit, and denied it is under shareholder pressure to quickly use its large cash reserves.

After Akzo Nobel reported better-than-expected Q1 results, Frohn said the acquisitions can be of 'any size in any region', company spokesman Tim van der Zanden confirmed him saying.

At its Chemicals unit -- where acquisitions are also possible -- Frohn said Akzo Nobel has five platforms in its portfolio and that it will only invest in those platforms, namely Pulp & Paper Chemicals, Polymer Chemicals, Surfactants, Functional Chemicals and Base Chemicals.

The CFO said Akzo Nobel has a medium-term strategy and it will not overpay for acquisitions, adding that it will investigate buying both family-owned and listed companies.

Spokesman Van der Zanden refused to comment on speculation Akzo Nobel was looking to buy the UK's ICI and did not comment on the size of any possible acquisitions.

Akzo Nobel has a large amount of cash following its announcement in March of its 11 bln eur sale of its pharmaceuticals unit Organon BioSciences to Schering-Plough Corp.

Frohn said the transition of Organon to Schering-Plough is 'on track' and is expected to be completed in the fourth quarter.

He denied Akzo Nobel had been approached by private equity firms since the sale of Organon, stressing also that shareholders have not placed pressure on the company to quickly dispose of its cash reserves.

Frohn said Akzo Nobel needs to create shareholder value in the medium to long-term and that spending money too quickly 'destroys value'.

In addition to its proposed first ever share buyback scheme today -- amounting to 1.3 bln eur or 10 pct of outstanding common shares -- Frohn said Akzo Nobel could return even more cash to shareholders later this year.

Akzo Nobel also plans to pay off pension liabilities in the UK, and Frohn said today it has already made an offer to the pension trustees and it expects to make an announcement on this in the second quarter.

Aaron Gray-Block; aaron.gray-block@thomson.com

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