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US paintmaker PPG has hinted it is not walking away from a tilt at Akzo Nobel, despite its Dutch rival rejecting a €20.9bn takeover approach.

The Pittsburgh-based chemicals manufacturer said it still believed there was a “strong strategic rationale” for a combination of the two companies, and would “carefully evaluate and consider its position and path forward related to its proposal”.

PPG’s unsolicited bid valued shares in Akzo Nobel, which owns the Dulux brand of paints, at €83 each and comprised €54 in cash and in 0.3 PPG stock. That is roughly a 29 per cent premium to Akzo Nobel’s undisturbed share price at the close yesterday.

However, Akzo Nobel on Thursday morning said it had dismissed the offer, on the grounds it substantially undervalued its prospects and made a broader appeal to its stakeholders by saying the takeover was not in the interests of customers and employees.

For its part, PPG said it had made an “attractive and comprehensive” proposal to Akzo Nobel on 2 March, inviting it to enter into merger negotiations.

Arguing its case for a merger, PPG said:

Strategically, the combination of PPG and AkzoNobel would deliver an enhanced global player in paints, coatings and specialty materials, combining complementary products, technologies and geographies, and would create a stronger competitor in a highly competitive global marketplace, offering a broader line of products and technologies cost-effectively to a more diverse customer base.

Financially, the combination would create a stronger enterprise with a solid investment grade rating.

The US company also said it was confident in its ability to execute the proposed transactions and obtain all necessary regulatory approvals – two concerns that Akzo Nobel raised in rebuffing the bid.

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