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Mexico: Failed Sherwin-Williams deal sparks hidden tension rumors

By  |  April 9, 2014

US paint giant Sherwin-Williams announced it would no longer pursue its $2.3 billion acquisition of Mexico rival Comex, following two requests from Mexican regulators to improve the deal to preserve competition.

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    But according to reports, a letter sent by Comex to Sherwin-Williams earlier this month hints at a feud brewing between the two parties that may have also played a role in the merger’s demise.

    Sherwin-Williams received the letter April 1 in which Comex accuses the company of failing to use “commercially reasonable efforts” to finalize the deal; such an accusation suggests Sherwin-Williams was in breach of their merger agreement, say reports.

    Mexico’s Federal Economic Competition Commission had expressed significant concern over the merger with its largest paint supplier considering the deal would lead to a company with more 50 percent market share – eight times more powerful than its closest competitor in the nation.

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