[Translation]
October 20, 2021
For immediate release
Company:

Nippon Paint Holdings Co., Ltd.

Representative: Yuichiro Wakatsuki, Representative Executive
Officer & Co-President
Wee Siew Kim, Representative Executive Officer& Co-President(Code No.: 4612, TSE 1st Section)
Contact:

Ryosuke Tanaka, General Manager of Investor
Relations
TEL: +81 50 3131 7419

Notice Regarding Acquisition of Shares of Cromology Holding SAS by Our Indirectly Owned Subsidiary(Conversion into an Indirectly Owned Subsidiary)

Nippon Paint Holdings Co., Ltd. (NPHD) is announcing that DuluxGroup Limited (DuluxGroup), its consolidated
subsidiary, has committed to acquire the share capital of Cromology Holding SAS (Cromology) and its subsidiaries tomake them indirectly owned subsidiaries of NPHD (the “Acquisition”). The share acquisition will be conducted through
DGL International (UK) Ltd, a UK-based company newly established by DuluxGroup. Cromology is engaged in
manufacturing and sale of decorative paints and other paint-related products in Europe. DuluxGroup has entered into aPut Option Agreement with the main shareholders of Cromology, including notably the Wendel group through its
subsidiary Winvest International SCS FIAR, pursuant to which DuluxGroup committed to acquire Cromology. In case ofexercise of such Put Option by the main shareholders of Cromology further to the completion of the consultation of therelevant works council of the Cromology group on this proposed transaction, which is compulsory under French law,
Dulux Group and Cromology’s shareholders will execute a Share and Purchase Agreement.
The Board of Directors of NPHD decided during its meeting held on October 13, 2021 to entrust the decision-making
on the signing of the Put Option Agreement, to which a draft Share Purchase Agreement is attached, to the Representative
Executive Officers and Co-Presidents. Since all conditions have been met, we have decided to formally conclude the PutOption Agreement on October 20 2021.

1.

Reasons for the acquisition of shares
The Nippon Paint Group is pursuing Maximization of Shareholder Value as its ultimate objective. Toward achieving

this goal, our New Medium-Term Plan has set targets to achieve revenue growth that outpaces the market growth in ouroperating regions by promoting growth strategies in our operating regions and businesses based on Powerful Partnerships
between our Group partner companies. In addition, we are aggressively pursuing M&A activities by leveraging the highgrowth potential and stable cash flows of the paint market in order to firmly establish our sustainable growth and further
increase our market presence around the world.
The European paint market is the world’s second largest* following the China market and has prospects for stablegrowth. Cromology is the fourth largest architectural paints manufacturer in Europe. As a market leader in the architectural1RESTRICTED

paints market, Cromology operates in broad markets in Europe with high market share, rated top 3 in France, Italy, Spainand Portugal.
Under the Nippon Paint Group’s ownership, combining the Group’s investment capacity and capability in brandmanagement, marketing and innovation, with a recognized local brand and strong trade and retail relationships, would
give access to scale across France, Spain, Italy and Portugal and subsequently into other major European markets,
including some new Central European countries.
Cromology would provide the right level of scale, volume and manufacturing capability to form the entry point into
building a decorative Paint and Coatings business in Europe, and provide the platform to bolt in other acquisitions
Cromology’s integrated wholly owned network of 386 company operated stores across France, Portugal andSwitzerland presents an opportunity to leverage DuluxGroup’s operational capability in running trade centers. It also
provides a strong platform to leverage DuluxGroup’s capabilities in selling to DIY consumers in retail channels such as
big box hardware and independent hardware. Finally, it also presents an opportunity to launch other brands in theDuluxGroup’s portfolio, including in Woodcare and Texture coatings and Sealants, Adhesives & Fillers.
The contemplated Acquisition is expected to contribute to be EPS accretive from the first year of acquisition. The
shares of Cromology would be acquired by DGL International (UK) Ltd, a UK-based company newly established byDuluxGroup using funds provided by NPHD through borrowings from financial institutions. Nippon is not proposing toraise equity funding.
*Source: Global Market Analysis for the Paint & Coatings Industry (2019-2024) published by American CoatingsAssociation.

2.

https://paint.org/market

Overview of our indirectly owned subsidiary acquiring shares of Cromology
(1)

Name

DGL International (UK) Ltd(2)Address

Suite 1, 3rd Floor, 11-12 St James's Square, London SW1Y 4LB UK(3)

Names and positions ofAndrew John Ryan, Director

representatives

Richard Paul Stuckes, Director(4)

Description of business

A holding company(5)

Capital stock

To be determined *2(6)Date of establishment

October 4, 2021

(7)

Major shareholders andDuluxGroup (Investments) Pty Ltd：100%ownership ratio(8)

Relationship with theCapitalThe Company indirectly owns 100% of the shares oflisted company

relationship

DGL International (UK) Ltd*2 Capital stock is not determined yet because the relevant company is newly established and is undergoing various
procedures associated with company establishment.

3.

Overview of our indirectly owned subsidiary to be transferred
(1)

Name

Cromology Holding SAS(2)

Address

Clichy, France(3)

Names and positions ofrepresentativesLoïc Derrien, CEO(4)

Description of business

Manufacture and sale of paint and adjacent non-paint products

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(5)Stated capital

EUR 244mn (JPY 31,976mn)(6)Date of establishment

June 6, 2006

(7)

Major shareholders andownership ratio(8)

Relationship with thelisted company

Wendel (through Winvest International SCS 94.8%
FIAR)
Others5.2%
CapitalThere are no capital relationships to be stated.
relationship(9)

There are no personal relationships to be stated.

Transactional
relationship

There are no business relationships to be stated.

Management results and financial situation over the last three years

Fiscal year ended

Fiscal Year Ended
December 31, 2018

Fiscal Year Ended
December 31, 2019

Fiscal Year EndedDecember 31, 2020

Total equity

EUR 214mn(JPY 28,045mn)

EUR 302mn(JPY 39,577mn)

EUR 313mn(JPY 41,019mn)

Total assets

EUR 819mn(JPY 107,330mn)

EUR 882mn(JPY 115,586mn)

EUR 899mn(JPY 117,814mn)

Net sales

EUR 665mn(JPY 87,148mn)

EUR 668mn(JPY 87,541mn)

EUR 628mn(JPY 82,299mn)

EBITDAEUR 29mn(JPY 3,800mn)

EUR 42mn(JPY 5,504mn)

EUR 64mn(JPY 8,387mn)

ProfitEUR -116mn(JPY - 15,202mn)

EUR -37mn(JPY - 4,849mn)

EUR 8mn(JPY 1,048mn)

EUR 0.00mn(JPY 0.00mn)

EUR 0.03mn(JPY 4mn)

EUR 0.00mn(JPY 0.00mn)

Dividends

4.

Personnel
relationship

Overview of the counterparties in the share transfer(1)

NameWendel(2)

Address

Paris, France(3)

Names and positions ofrepresentatives

André François-Poncet, CEO(4)

Description of business

Listed investment company(5)

Stated capital

EUR 179mn (JPY 23,458 mn)(6)Date of establishment

December 4, 1871

(7)

Major shareholders andownership ratio

Wendel-Participations SE

39.3%

Institutional investors

37.7%

Individual shareholders

18.8%

Treasury shares

2.0%

Employees and members of the Executive
Board

0.9%

Other

1.4%

(8)

Relationship with thelisted company

Capitalrelationship

There are no capital relationships to be stated.

Personnel
relationship

There are no personal relationships to be stated.

Transactional

There are no business relationships to be stated.

3
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relationship
Status as arelated party(9)

There are no applicable circumstances to be stated.

Management results and financial situation over the last three years

Fiscal year ended

Fiscal Year Ended
December 31, 2018

Fiscal Year Ended
December 31, 2019

Fiscal Year Ended
December 31, 2020

Total equity

EUR 2,160mn(JPY 283,068mn)

EUR 2,423mn(JPY 317,534mn)

EUR 2,004mn(JPY 262,624mn)

Total assets

EUR 7,962mn(JPY 1,043,420mn)

EUR 8,670mn(JPY 1,136,204mn)

EUR 7,410mn(JPY 971,081mn)

Consolidated net sales

EUR 8,389mn *4(JPY 1,099,378mn)

EUR 8,110mn(JPY 1,062,816mn)

EUR 7,459mn(JPY 977,502mn)

Operating income

EUR 676mn(JPY 88,590mn)EUR 726mn(JPY 95,142mn)

EUR 300mn(JPY 39,315mn)

ProfitEUR 280mn(JPY 36,694mn)

EUR 626mn(JPY 82,037mn)

EUR -231mn(JPY - 30,273mn)

EUR 2.80(JPY 367)

EUR 2.80(JPY 367)

EUR 2.90(JPY 380)

Dividend per share*4: In 2018, sales didn’t include the sales of Tsebo, in accordance with IFRS 5.

5.

Number of shares transferred, and status of shareholdings before and after the transfer
(1)

(2)

Number of shares held

0 sharesbefore the change(Percentage of shareholding: 0.0%)

Number of shares to be

52,594,858 sharestransferred

6.

7.

(3)

Acquisition priceEUR 1,152 mn (JPY 150,970 mn）(4)

Number of shares held

52,594,858 shares

after the change(Percentage of shareholding: 100.0%)

Schedule(1)

Date of resolution by the board ofdirectors

October 20, 2021

(2)

Date of execution of the Put Option
Agreement

October 20, 2021

(3)

Closing date of the Share Transfer

Scheduled for H1 2022

Future outlook
The date of execution of the share transfer is scheduled for H1 2022. As a result, we expect that the impact of thetransaction on our earnings for the fiscal year ending December 31, 2021 will be insignificant.

8.

Advisors
HSBC acted as financial advisor and Clifford Chance acted as legal counsel to DuluxGroup.
*The exchange rate used to prepare this document is EUR 1.0 = JPY 131.05, which is the same exchange rate used
to calculate the revision of the consolidated earnings forecast for the fiscal year ending December 31, 2021 releasedon October 12, 2021.

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