Akzo Nobel N.V. Agrees To Buy Canada's Sico For $250 Million

LONGUEUIL, QUEBEC--(MARKET WIRE)--Apr 5, 2006 -- Sico Inc. ("SICO" or "the Company");(Toronto:SIC.TO - News) today announced that it has reached an agreement with AKZO NOBEL N.V. (Euronext Amsterdam:AKY); (NasdaqNM:AKZOY - News), to support a take-over bid by AKZO NOBEL to acquire all of the issued and outstanding shares of the Company at a cash price of $20.00 per common share, for an aggregate consideration of approximately $284 million (based on 14,198,387 common shares outstanding on a fully-diluted basis). AKZO NOBEL will also offer to acquire at par value all of the issued and outstanding class B preferred shares of the Company for a total consideration equal to $3.8 million, being the redemption price of such preferred shares. All dollar amounts are in Canadian dollars.

The purchase price represents a premium of 44% over the last 20-day average closing price of SICO's common shares. The transaction has been approved unanimously by the special committee of the SICO Board of Directors created to review AKZO NOBEL's offer, and also unanimously approved by the Company's Board of Directors. This transaction is subject to customary closing conditions.

SICO's principal shareholders who hold approximately 34% of the fully-diluted outstanding SICO common shares and all of the SICO class B preferred shares have agreed with AKZO NOBEL through a "hard lock-up" agreement to tender their shares to the offer.

Pierre Dufresne, President and Chief Executive Officer of SICO, commented: "We welcome this unsolicited offer from AKZO NOBEL which represents a premium of approximately 43% above yesterday's closing price for SICO common shares. Being part of the world's biggest coatings company will not only boost the profile of our brands, but will also give our employees access to world class expertise and technology. Our customers will also benefit from enhanced products and services, all of which will prove invaluable in terms of building the business and maintaining our growth momentum."

Terms of the agreement

AKZO NOBEL's take-over bid circular will be mailed to SICO shareholders within 20 days. The offer is subject to certain conditions that are required to be satisfied prior to take-up and payment by AKZO NOBEL, including, but not limited to, the tender of at least 66 2/3% of the total number of SICO common shares, calculated on a fully-diluted basis, and compliance with necessary regulatory requirements. The Company currently anticipates closing the transaction in the second quarter of 2006.

SICO's Board of Directors, upon recommendation of the special committee and after consultation with its advisors, determined that the AKZO NOBEL offer, including the price per common share offered, is fair to the holders of common shares and that the transaction is in the best interests of the Company and will recommend unanimously, in its directors' circular to be mailed to SICO shareholders concurrently with AKZO NOBEL's take-over bid circular, that shareholders accept AKZO NOBEL's cash offer. CIBC World Markets Inc., acting as exclusive financial advisor to SICO, has provided an opinion to the special committee of the Board of Directors of SICO which reviewed AKZO NOBEL's offer and to the Board of Directors of SICO that the consideration under the offer is fair to SICO common shareholders from a financial point of view. Stikeman Elliott LLP acts as legal counsel to the Board and Special committee of SICO for this transaction, while Blake, Cassels & Graydon LLP acts as legal counsel and Stuart Lammert & Co. acts as exclusive financial advisor to AKZO NOBEL.

SICO has entered into a support agreement with AKZO NOBEL which contains terms and conditions typical for transactions of this nature and which prohibits SICO from soliciting any competing offers. In certain circumstances, SICO may terminate the acquisition agreement and withdraw its recommendation to shareholders to accept AKZO NOBEL's offer. In such event, and in certain other circumstances where AKZO NOBEL's offer is not completed, SICO would be required to pay a termination fee to AKZO NOBEL of $4 million, plus expenses up to $2 million. The support agreement also allows SICO to declare and pay before the expiry time of the offer one regular quarterly dividend, up to a maximum of $0.08 per common share.

Under the terms of the support agreement, AKZO NOBEL shall retain the head office and operational headquarters of the SICO business in the Province of Quebec and continue to use the "SICO" name in the products of the business.

About AKZO NOBEL

AKZO NOBEL is the world's largest coatings manufacturer. The company achieved global sales in coatings of EUR 5.56 billion in 2005 and command leading market positions in nearly all its businesses. AKZO NOBEL develops, manufactures and markets innovative, high quality products and services for most market segments. The company's extensive portfolio includes decorative paints; products for industrial applications such as powder, wood, coil and specialty coatings; automotive refinishes; marine, protective and aerospace coatings; and coatings related products such as wood and building adhesives. Brands include global and household names such as Crown®, International®, Sikkens®, Interpon®, Levis® and Sadolin®.

About SICO

In business since 1937, SICO is the largest company in Canada specializing in the development, manufacture and marketing of paints, coatings and related products. In the architectural market, its core business, SICO stands out for its innovative, high-quality products, strong brand recognition and the scope of its distribution network, which includes some 2,500 points of sale from coast to coast. In North America, SICO also markets industrial coatings primarily for metal, and mostly intended for the transportation equipment industry, the heavy machinery industry and other specialized applications. SICO employs more than 1,000 people in Canada, the United States and Mexico.

Cautionary note about forward-looking statements

Certain statements made in this release, including those concerning the expected closing of the transaction referred to herein, are forward-looking statements that involve risks and uncertainties, which may prevent expected future results from being achieved. For those statements, SICO claims the protection of the safe harbour for forward-looking statements contained in the Canadian and U.S. securities laws. SICO cautions that actual future performance could be affected by a number of factors, including the fact that the expected closing of the transaction referred to in this release is subject to customary closing conditions, many of which are beyond SICO's control. Therefore, future events and results may vary substantially from what SICO currently foresees. Additional information identifying risks and uncertainties is contained in SICO's filings under applicable securities laws.

Contact:

Contacts:

SICO INC. Pierre Dufresne, CA President and Chief Executive Officer (514) 527-5111

SICO INC. Jean Ouellet, CA Vice President, Finance and Treasurer (514) 527-5111 http://www.sico.com

Source: SICO INC.

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