Part 3 of a three-part series on M&A trends in the paints and coatings industry. Parts 1 and 2 examined the major billion-euro deals as well as the quieter consolidation amongst small and medium-sized enterprises.
The Paints & Coatings Industry: Valuations, Buyers, and a Warning Sign for Sellers
Market Situation: Consolidation Despite Economic Weakness
Economically, the industry’s situation remains strained. According to VdL data, sales volumes in Germany fell by 2.8% in 2025, with architectural coatings (-3.5%), powder coatings (-5%), and printing inks (-5%) hit particularly hard. Only automotive OEM coatings and anti-corrosion coatings showed slight signs of stabilization, buoyed by higher infrastructure investment and increased automotive production figures.
Despite this, M&A activity is picking up. Several structural factors are driving this simultaneously. Cost pressure from volatile raw material and energy prices is creating a need for scale: synergies in purchasing, R&D, and production only pay off once a company reaches a certain size. At the same time, large corporations are pushing ahead with portfolio streamlining, shedding non-core activities such as BASF Coatings or BASF Deko Brazil in order to channel capital more deliberately into their core competencies.
On both sides, geographic expansion is also shaping the picture: German mid-sized companies are seeking growth in Asia, while international corporations are pushing deeper into the DACH region. And after years of restraint, financial investors are returning, showing renewed interest especially in well-positioned niche players with a clear equity story.
Valuation Levels: What the Market Is Paying Today
Compared with the record year of 2021, valuations have normalized, but they remain at elevated levels. For large transactions with a strong strategic rationale, EBITDA multiples of between 12x and 16x are being paid, trending somewhat below the levels seen during the post-Covid boom. For standout niche players, significantly higher multiples remain achievable.
For context, it’s worth looking at three reference points: the listed peer group, the transaction multiples of recent large-scale deals, and the range seen among DACH mid-sized companies.
Median (7-Peer Set)
Mid-Market Range
10-Year Average
'16–17 · Post-Crisis
'18–19 · Trade War
'20–21 · Covid Peak (14.8x)
'22–23 · Inflation
'24 · Normalization
'25–26 · Current (9.1x)
Source: LCO Research based on public financial statements, market capitalizations, and Capital IQ data. Figures = Enterprise Value / EBITDA (LTM). Figures prior to 2024 are LCO estimates; from Q3 2024 onward, figures are verified via MarketScreener and Capital IQ. Peer set: Sherwin-Williams, PPG Industries, RPM International, Axalta Coating Systems, AkzoNobel, Nippon Paint, and Kansai Paint.
Peer-Group
The listed industry heavyweights AkzoNobel, Axalta, PPG, Sherwin-Williams, Nippon Paint, Kansai Paint, and RPM currently trade at EV/EBITDA multiples of 7 to 13x, with a median around 9x, roughly 20% below their ten-year average. Interest burden, weak construction activity, and raw material volatility have left a clear mark. Only Sherwin-Williams has held onto its premium valuation, supported by consistent margins and strong vertical integration.
It’s precisely this valuation compression that’s fueling the current consolidation wave, as strategic buyers and financial investors take deliberate advantage of the lower price levels. Carlyle is paying an enterprise value of €7.7 billion for BASF Coatings, on revenue of around €3.8 billion, roughly 2.0x revenue and an estimated EBITDA multiple of 12 to 13x. That’s a clear premium over where listed peers currently trade, though still below the roughly 15x paid for comparable carve-outs during the 2020/21 boom years. The sale of Stahl to Henkel, meanwhile, values the company at an enterprise value of €2.1 billion on revenue of €725 million, or 2.9x revenue; with a reported EBITDA margin of over 20%, that works out to an EV/EBITDA of roughly 14 to 15x. This high valuation reflects Stahl’s positioning as a pure specialty player with no commodity volume business, along with its global market leadership in coatings for flexible materials such as leather, paper, films, and packaging. Tight approval processes, high switching costs, and stable margins all play a central role in supporting this valuation.
Mid-Sized Companies in the DACH Region
Specialists in industrial coatings, powder coatings, marine, or functional coatings are valued at 7 to 10x EBITDA. Hidden champions with a high share of recurring revenue and a mature ESG profile can achieve up to 12x in competitive auctions. Commodity architectural coatings and standard printing inks range from 4 to 6x, while distressed cases such as Mocopinus change hands at little more than liquidation value.
Valuation Premiums and Their Drivers
Strategic investors typically pay 1 to 2x more on EBITDA than financial investors, with competitive auctions sometimes adding a further 1 to 1.5x on top. Between a quiet, off-market sale process and a competitive one, that translates into a proceeds difference of 25 to 35%. Particularly well rewarded at present are recurring OEM revenue, in-house binder or resin production, a future-proof bio- or water-based portfolio, and a visible leadership position within the relevant sub-segment.
The persistently high interest rate environment, together with operational headwinds such as raw material volatility, weak construction activity, and refinancing pressure, argue against a broad-based recovery in multiples across the industry average. Clearly positioned specialists with recognizable differentiation, a high share of recurring revenue, and stable margins, by contrast, continue to command premium multiples. The valuation spread within the peer group therefore seems more likely to widen than to narrow.
We’d be happy to show you how these valuation ranges translate to your own company in an indicative assessment, tailored specifically to mid-sized paints and coatings businesses.
Active Buyers in the DACH Region: Who’s Buying Whom?
The buyer landscape has broadened considerably. Alongside the well-known international strategics, new players are increasingly entering the field.
International corporations from the US, Japan, and Europe, including PPG, Sherwin-Williams, AkzoNobel, Nippon Paint, and Kansai Paint, remain active in the market. Through its Slovenian platform Kansai Helios, Kansai Paint is building by far the most active acquisition track record among DACH mid-sized companies in the industry, while the ultimately unsuccessful counterattack by Nippon Paint and Sherwin-Williams on AkzoNobel shows that the appetite for consolidation remains undiminished even at the very top of the market.
German mid-sized companies with global ambitions, such as MIPA, Remmers, Peter Lacke, and Siegwerk, are making targeted acquisitions of capabilities or geographic reach without giving up their independence.
Financial investors with proven sector expertise, such as Carlyle/QIA in the case of BASF Coatings, Fidelium Partners in the case of JWO, or IK Investment Partners in the case of Blanchon Group, demonstrate that PE firms with deep industry knowledge can still generate compelling returns even in a challenging environment.
Added to this are new buyers from the Middle East and Asia: the Qatar Investment Authority’s involvement in BASF Coatings is a prime example of growing interest from sovereign wealth funds in Europe’s industrial crown jewels.
Structurally, the architectural coatings segment is already considered largely consolidated. In industrial coatings, particularly corrosion protection, wood coatings, and specialty coatings, however, substantial consolidation potential remains. This is where most further transactions are likely to take place in the coming years.
When M&A Fails: The Mocopinus Case
Mocopinus, the 160-year-old traditional company from Ulm specializing in solid wood profiles and wood coatings, was forced to shut down all of its locations in March 2026. 270 employees lost their jobs as a result. Despite intensive efforts to find a buyer, no viable acquirer emerged, although Lignum-Finish, based in Aitrach, may possibly continue to operate separately thanks to ongoing talks with investors.
The Mocopinus case illustrates the strategic reality behind the valuation range described above: a standard mid-sized wood and architectural coatings company without its own specialty niche, without a nationally recognized brand, and operating in a structurally shrinking end market can no longer find a solvent bidder, even in an active M&A environment.
Companies that push forward technologically, hold their ground in a specialty niche, and present a clear brand and distribution position, by contrast, continue to attract strong buyer interest even in today’s market environment.
Conclusion: The Next Wave of Consolidation Has Begun
The M&A market in the paints and coatings industry is at a turning point. The strategic realignment of the industry’s major players, growing pressure on mid-sized companies, and the return of financial investors are combining, despite or perhaps precisely because of the economic weakness, to create an unusually dynamic deal environment.
For owners of mid-sized companies in the DACH region, this means that buyer interest remains high and is structurally anchored, while valuations sit at a level that allows for attractive proceeds. At the same time, competitive pressure is growing from globally expanding players gaining market share through targeted acquisitions.
The next wave of consolidation is therefore not a cyclical phenomenon but a structural one, driven by regulatory substitution pressure, the logic of vertical integration, and the return of disciplined PE buyers with sector experience. Companies that come to the table with clean numbers, a clear equity story, and a differentiated position within their sub-segment are genuinely able to capture the premium multiples available at this stage of the market. The gap between a well-prepared process and an improvised one is about as wide as it has ever been. Whether as a buyer, a seller, or a merger partner, the next wave of consolidation has begun. Those who are prepared will benefit from it.
