Axalta Coating Systems Ltd. has parted ways with its recently hired chief executive officer, Terrence Hahn, after only five weeks on the job. The dismissal came after an internal investigation turned up conduct that Axalta “believes was inconsistent with company policies.” The chief financial officer Robert Bryant is taking over as acting chief executive.
Berkshire Hathaway currently owns 24,264,000 shares of Axalta with a current market value of $736,655,040. Some 20 million of those shares were purchased in April of 2015 from The Carlyle Group.
Axalta has repeatedly been a failed takeover candidate, most recently from Nippon Paint.
Previously the company fought an unsolicited takeover from paint company PPG, and also held merger discussions with Dutch coatings company AkzoNobel.
Axalta was founded in 1866 as Herberts, the original producer of Standox paint products. Spun off of DuPont Performance Coatings in 2013, it was sold to The Carlyle Group and renamed Axalta Coating Systems. Today the company is a leader in coatings for commercial vehicles.
When Berkshire took its stake in Axalta back in 2015, the company looked like a possible merger candidate with Berkshire’s Lubrizol. However, Berkshire’s never been shy about owning significant minority stakes in companies if they are purchased at favorable prices.
Unfortunately, with Axalta continuing to lose money, it looks more likely that Berkshire will simply exit its position through a third-party acquisition.
© 2018 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.