The new owner of Wattyl Australia and New Zealand, Hempel Group, says it has no immediate plans to close the Churchill Rd manufacturing site or reduce employment numbers there.
The company announced on Friday it had purchased the Wattyl business from US paint giant Sherwin-Williams.
The move is part of Hempel’s bid to double revenue to $4.6 billion (3 billion euros) by 2025 and increase its presence in South East Asia.
Founded in 1915, Wattyl is headquartered in Sydney and has manufacturing sites in Kilburn and the Melbourne suburb of Footscray.
It also has five distribution centres – four in Australia and one in New Zealand – nearly 100 company-owned stores, 750 employees and annual revenue of about $230 million.
About 50 staff work at the Kilburn site in Adelaide’s inner-north, which includes the factory, distribution centre and retail shop.
United Workers Union represents the Kilburn Wattyl staff but declined to comment on the sale or what it would mean for local workers.
Hempel president and CEO Lars Petersson said the acquisition was part of the group’s Double Impact strategy to grow its paint segments and would not lead to a reduction in employment numbers at Kilburn.
He said the Wattyl business model aligned well with Hempel’s challenges in Australia and New Zealand, which included its lack of local production and distribution.
“Hempel has no plans of closing the manufacturing site in Kilburn as a consequence of the acquisition, but naturally we cannot give any guarantees as we will adjust our company to the current market we operate in,” Petersson said
“Wattyl is a leading brand with a strong distribution set-up with its own store network, key Independent Trade Centres and strategic distribution partnerships servicing the DIY and trade consumers.
“We’re going for leadership positions in selected segments and geographies, and we aim to double our revenue within five years to EUR 3 billion.”
Wattyl will still be managed by Sydney-based managing director Matt Crossingham, who said it was business as usual following the acquisition.
He said Wattyl would continue to be the company’s flagship brand in the ANZ region.
“We are still the same Wattyl – proudly made right here in Australia for Australian and New Zealand conditions. Our heritage of over 100 years of locally manufactured protection and innovation continues,” Crossingham said.
“We are looking forward to contributing to Hempel’s growth and development – not only in Australia and New Zealand – but throughout the South and East Asia region.”
The sale is expected to close before the end of March, subject to customary closing conditions.
The Wattyl business became part of Sherwin-Williams through the 2017 acquisition of The Valspar Corporation.
Valspar bought the previously ASX-listed Wattyl in 2010.
Cleveland-based Sherwin-Williams is the world’s largest paint and coatings company and had been courting potential Wattyl buyers since mid-2020.
Sherwin-Williams chairman and CEO John G. Morikis said the decision to divest Wattyl was based on its “ability to meet our performance criteria and for their long-term strategic fit”.
“While we’ve driven significant improvement in the Wattyl business, we believe company resources can be better deployed to other opportunities offering greater growth, more meaningful scale, and higher returns and cash flow,” he said.
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