Nipping rumors in the bud, AkzoNobel announced Thursday it had rejected an unsolicited $22.19 billion PPG offer to buy it out.

However, it might still sell or spin off its specialty chemicals business.

“The unsolicited proposal we received from PPG substantially undervalues our company and contains serious risks and uncertainties,” CEO Ton Büchner said in a statement. “The proposal is not in the interest of AkzoNobel’s stakeholders, including its shareholders, customers and employees, and we have unanimously rejected it. Along with my colleagues on our Boards, our executive team and our thousands of employees, I firmly believe that AkzoNobel is best placed to unlock the value within our company ourselves.”

PPG had offered about $87.98 a share for AkzoNobel, which had 252,176,412 common shares as of Dec. 1, 2016. PPG in a news release Thursday called the $22.19 billion offer “an attractive and comprehensive proposal,” but AkzoNobel dismissed it as “substantially” too low.

“The Boards have unanimously ‎concluded that the PPG proposal substantially undervalues AkzoNobel by failing to reflect the long-term value creation potential of the company,” AkzoNobel wrote in a news release. “The Boards have also concluded that the equity component of the proposal has significant issues, including the high leverage of the proposed combination.  They also believe the proposal carries significant‎ delivery and timing risk for shareholders, both in relation to substantial anti-trust issues, pension schemes and the achievability of proposed synergies.”

PPG countered that it was confident that buying AkzoNobel could pass regulatory muster and produce “a stronger enterprise with a solid investment grade rating.”

AkzoNobel also wrote that the PPG offer would leave thousands of employees uncertain about their future and possibly threaten “the company’s major contribution to communities and research & development organizations globally and its deep commitment to sustainability.”

PPG said it’d be a good owner, continuing “the heritage of AkzoNobel’s culture and best practices” and “the legacies of both companies, including the use of flagship brands and technologies, investment in research, development and innovation, and the companies’ longstanding commitment to being good employers and corporate citizens that operate in a sustainable and socially responsible manner.”

“PPG has long admired AkzoNobel’s businesses, global presence, culture and principles as well as its advances in innovative product development and sustainable business practices,” PPG CEO Michael McGarry said in a statement. “We believe a combination of our two companies is a very compelling strategic opportunity. We are confident that this combination is in the best interests of the stakeholders of both companies as it presents a unique opportunity to build on the successful legacies of our businesses. PPG has carefully considered the interest of all AkzoNobel stakeholders including shareholders, employees, customers and the communities it serves and has proposed its willingness to enter into serious commitments in respect of all stakeholders.”

The Pittsburgh, Pa.-based company seemed to signal that it’d keep its eye on AkzoNobel in the future: “PPG continues to believe there is a strong strategic rationale for the proposed transaction between PPG and AkzoNobel and will carefully evaluate and consider its position and path forward related to its proposal,” it wrote in a news release.

AkzoNobel didn’t indicate any new plans for its automotive or automotive refinishing products, aside from possibly spinning off its specialty chemicals line to create “focus” for the Decorative Paints and Performance Coatings group. The latter includes brands like Sikkens, Lesonal and Wanda.

“Our Specialty Chemicals business is an industry leader in many of the markets in which it operates and we are extremely proud of its heritage, performance and people,” Büchner said in a statement. “We are reviewing strategic options to separate it from the company to create focus for both Specialty Chemicals and the Decorative Paints and Performance Coatings group, allowing them to build further on their respective leadership positions.”

AkzoNobel said specialty chemicals brought in $5.01 billion in revenue last year, and it was still trying to figure out what to do with the line. One option might be spinning it off into a separate publicly traded company, AkzoNobel said.

“The ultimate structure will be determined by reference to shareholder value maximization as well as broader stakeholder considerations,” AkzoNobel wrote in a news release.

Clarification: This article has since been updated to reflect the euro-to-dollar exchange rate of $1.06 late Thursday afternoon rather than the $1.05 rate from about 12 hours prior.

More information:

“PPG confirms proposal for AkzoNobel”

PPG, March 9, 2017

“AkzoNobel reviewing strategic options to separate Specialty Chemicals”

AkzoNobel, March 9, 2017

Featured image: AkzoNobel’s logo is shown. (Provided by AkzoNobel)