Sherwin-Williams (NYSE: SHW) and Valspar (NYSE: VAL) have extended the termination date for their pending merger from March 21 to June 21, allowing for more time to meet regulatory requirements. Sherwin-Williams agreed to acquire Valspar last March for $113 per share in an all-cash transaction valued at $11.3 billion, a deal expected to create $280 million in annual synergies for the providers of paint and other coating supplies.
Upon review, the US Federal Trade Commission required Valspar to divest a portion of its portfolio before the deal received regulatory approval. Valspar has an undisclosed divestiture lined up, but that deal is expected to be below the threshold required for the deal, at least $650 million of Valspar's 2015 revenues. Sherwin-Williams retains the right to terminate the transaction if the required divestitures exceed $1.5 billion of Valspar’s 2015 revenues. Neither company's stock moved much in the wake of the delay.