By Chelsey Dulaney
Warren Buffett's Berkshire Hathaway Inc. has agreed to buy an
8.7% stake in paint maker Axalta Coating Systems Ltd. from
private-equity firm Carlyle Group LP.
Carlyle, which currently holds a 74.1% controlling stake in the
company, according to FactSet, recently announced plans to pare
back its stake in Axalta through a secondary offering of 40 million
shares.
Carlyle bought Axalta from DuPont Co. in 2013 in a $4.9 billion
deal and took the company public in November in a $1 billion
offering that priced at $19.50 a share.
Carlyle said it would sell 20 million shares to an affiliate of
Berkshire for $560 million through a private placement. The price
of $28 a share is just below Axalta's closing price of $28.33 a
share on Monday.
Berkshire, which also owns paint company Benjamin Moore &
Co., will become Axalta's largest shareholder behind Carlyle.
Axalta's shares gained 5.4% to $29.85 in premarket trading.
"We are pleased to have Berkshire Hathaway Inc. take this share
ownership position in Axalta," said Axalta Chief Executive Charlie
Shaver in a news release. "We believe this investment shows
Berkshire's support of our strategy to reshape ourselves into a
growth and customer-oriented, world-class coatings company."
Carlyle and other private-equity firms have jumped at the chance
to sell shares of the companies they own amid the rising stock
market of the past few years. Stock sales have driven profits, and
payouts to shareholders, at Carlyle and its competitors in recent
quarters.
Axalta, which won't receive proceeds from the sale, makes
coatings for a range of products, from Weber grills to Ford F-150
pickup trucks. The Philadelphia company's best customers are auto
body repair shops.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
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