PE-firm Brait sells out of Freeworld Coatings

South African private equity firm Brait has sold a 19 percent stake in Freeworld Coatings, a Johannesburg-based paint company, to Japan’s Kansai Paint. Kansai Paint has bought a 25 percent stake overall in the company. Brait had previously attempted a 1.7 billion rand ($248.3 million) takeover of Freeworld, but it was rejected by shareholders.

(Reuters) – Japan’s Kansai Paint has bought about 25 percent of South Africa’s Freeworld Coatings, and is in talks to take at least a majority stake in the paint firm, according to people familiar with the matter.

Kansai, one of Japan’s largest paint makers, has bought nearly 19 percent of Freeworld from South African private equity firm Brait as well as additional shares, according to three people, who declined to be identified because the information has not been made public.

Kansai’s stake currently stands at around 25 percent and talks between the two companies are still ongoing, two of the people familiar with the talks said. The Japanese firm is looking to raise its holding to at least a majority stake, one of the people said. It was not immediately clear whether the two sides would come to an agreement.

Brait’s sale to Kansai came after Freeworld’s shareholders in June rejected a 1.7 billion rand ($248.3 million) takeover bid from Brait, the three people said. A spokesman for Freeworld declined to comment and referred to a cautionary announcement released on Aug. 30. A spokesman for Osaka-based Kansai declined to comment.

Freeworld said in August it had received an “approach” from a shareholder that raised competition-related concerns and the matter would be referred to competition officials.
(Reporting by David Dolan and Emi Emoto; Editing by Marius Bosch)