Mexican regulator again blocks Sherwin Williams' $2.34-bn Consorcio Comex deal
31 October 2013
The Mexican antitrust regulator has rejected an appeal by US paint company Sherwin Williams over its blocked $2.34-billion proposed acquisition of Mexican paint company Consorcio Comex.
The Federal Economic Competition Commission (COFECE) had blocked the proposed transaction in July in a 3-2 vote. (See: Mexico's regulator blocks Sherwin-Williams $2.34-bn acquisition of Consorcio Comex)
Sherwin-Williams said it is reviewing the commission's decision and considering its options, including whether to refile with COFECE.
COFECE said that the merged company would have a market share of around 50 per cent, depending on the product, which would be as much as 8 to10 times the share of its closest competitor.
''It would have been able to set artificially high prices and commit anti-competitive practices to the detriment of consumers,'' the COFECE said.
In November 2012, Sherwin-Williams signed a definitive agreement to acquire Consorcio Comex, a leader in the paint and coatings market in Mexico for $2.34 billion in cash, including debt.
Founded in 1952, Mexico City-based Comex is a privately-held company with operations in Latin America, the US and Canada.
The company manufactures and sells architectural and industrial coatings as well as several industrial, protective and specialty coatings in Mexico through 3,300 points of sale operated by 750 concessionaires.
In the US, Comex sells its products under a variety of brand names through 240 company-operated paint stores.
Comex operates eight manufacturing sites in Mexico, five in the US and three in Canada, and had 2011 sales of $1.4 billion.