Competition Bureau resolves issues with Sherwin-Williams’ acquisition of Valspar

News Release

May 26, 2017 – OTTAWA, ON – Competition Bureau

The Competition Bureau has reached a consent agreement with The Sherwin-Williams Company (Sherwin-Williams) related to its acquisition of The Valspar Corporation (Valspar), which resolves competition concerns in the market for high volume orders of industrial wood coatings in Canada.

The Bureau’s investigation concluded that the proposed transaction, if allowed to proceed, would likely result in a substantial lessening of competition and increase prices for industrial wood coatings, such as varnishes and lacquers used by manufacturers of kitchen and bathroom cabinets, furniture and building products.   

To address the Bureau’s concerns, Sherwin-Williams has agreed to sell Valspar’s industrial wood coatings assets in Canada and the U.S. to Axalta Coating System Ltd. (Axalta), a new entrant in this market. The sale of Valspar’s assets include manufacturing plants, research and development assets, intellectual property, and customer contracts, which the Commissioner determined would be necessary to preserve competition and protect innovation in the market.

The Bureau determined that Axalta is an acceptable purchaser and could carry on Valspar’s industrial wood coatings business. Axalta is a global coatings company based in Pennsylvania, dedicated to the development, manufacture and sale of liquid and powder coatings, mainly for the automotive sector.

As the assets being sold by Valspar are located in both Canada and the U.S., the Bureau worked closely with the United States Federal Trade Commission which also reviewed the transaction.

Quick Facts

  • On March 20, 2016, Sherwin-Williams announced its intent to acquire Valspar for approximatively US$11.3 billion. Under the Competition Act, the Bureau has a mandate to review mergers to determine whether they are likely to result in a substantial lessening or prevention of competition.

  • As part of its normal approach in examining a merger, the Bureau consulted with a wide range of industry participants, such as suppliers, competitors, and customers.

  • The consent agreement is a formal agreement registered with the Competition Tribunal, which has the force of a court order and contains remedial measures that the Commissioner of Competition has determined will address the transaction’s likely anti‑competitive effects.

  • The Commissioner has issued a No Action Letter confirming he will not be challenging the transaction at this time.

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