Acquisition of shares in Sigma Coatings Nigeria Limited and Pittsburgh Paints Nigeria Limited by Chester Paints LLCCase type: MRR Form 2 (Simplified Procedure) Case Parties: Acquirer - Chester Paints LLC/Targets - Sigma Coatings Nigeria Limited and Pittsburgh Paints Nigeria Limited/17747533 Published: 20 Feb. 2023
Nature of the Transaction The proposed transaction is a single, inter-conditional and two-step transaction, involving the acquisition by Chester Paints LLC (Chester Paints or the Acquirer), of equity interests in Pittsburgh Paints Nigeria Limited (PPN) and Sigma Coatings Nigeria Limited (SCN). The first step to the transaction is the acquisition by PPN of the shares held by the minority shareholders in SCN (other than shares held by the majority shareholder of the Acquiriers group) (SCN Shares). The Acquirer shall then directly acquire the shares held by Sigma Marine and Protective Coatings Holdings BV (the Seller) in PPN and SCN pursuant to a share purchase agreement executed by the parties (the Transaction) and thereby acquiring control over PPN and (indirectly, through PPN) SCN. Parties to the Transaction The primary acquiring firm is Chester Paints LLC, the Acquirer. The Acquirer is a company incorporated under the laws of the United States of America and is a wholly-owned subsidiary of The Chester Group Inc., a Delaware corporation (the Chester Group). The proposed transaction involves the acquisition of control by the Acquirer of two primary target firms: i. Sigma Coatings Nigeria Limited; and ii. Pittsburgh Paints Nigeria Limited. (Sigma Coatings Nigeria Limited and Pittsburgh Paints Nigeria Limited shall where the context requires be collectively referred to as the Targets. The Acquirer and the Targets shall collectively be referred to as the Parties). Areas of activity of the parties to the merger Both the Acquirer and the Chester Group have no business operations in Nigeria, although the majority shareholder of Chester Group has a minority interest in Sigma Coatings Nigeria Limited. The Targets are active in the Nigerian protective and marine coatings market. The protective and marine coatings market serves the oil and gas, mining, infrastructure, power and marine industries. In the Nigerian market, the Targets supply paint products (coatings) that mainly consist of alkyds, acrylics, epoxies, zincs and polyurethanes. These products are heavy-duty coatings designed for the prevention of corrosion in refineries, mines, power stations, infrastructure, and marine environments. The Targets own and operate production facilities in Lagos, Nigeria, together with a distribution network focusing on Port Harcourt and Lagos. Economic rationale for the Transaction The proposed Transaction achieves the Sellers strategic intention to exit the Nigerian protective and marine coatings market in order to explore other business opportunities whilst also enabling Chester Group to achieve its objective of becoming a player in the market.