US based chemical producer DuPont has begun the preliminary auction process for sale of its car paint business which is anticipated to fetch over $4bn.
Sources told Reuters that the company's adviser on the agreement, Credit Suisse Group had sent financial resources connected to the unit sale to concerned clients and the facility is also expected to draw interest from further chemical companies.
The primary customers of Du Pont will include Maaco and other auto paint refinishers while Ford Motor and General Motors are also key customers.
DuPont could sell just the OEM component, keeping the more-lucrative paint refinishing business.
The performance-coatings operations contributed about 12% of company's $31.5bn revenue last year and 5.1% of operating income.
Coatings for refinishing vehicles accounted for almost $1.7bn of sales last year, new-car coatings totaled $1.2bn and sales of powder and liquid coatings were about $950m.
The US paint manufacturer Valspar said it is not in the race to bid for the DuPont paint business saying it "a little too big a bite for us".
Other large paint manufacturers, such as Akzo Nobel of the Netherlands, and private-equity firms are seen as potential buyers for the business unit.
