An update has come out on Akzo Nobel N.V. (AKZOY), in which senior chemical industry analyst Paul Raman, CFA is reiterating his Hold rating on the company.  We excerpted the following details:

'Akzo Nobel is enhancing its global position in coatings through acquisitions and internal growth. The company sold its pharma business to Schering-Plough (SGP). Thus, Akzo Nobel is a core chemicals and coatings company. The company has announced to acquire Imperial Chemical Industries, a leading paints and specialty chemicals company.

'Although the shareholders approved the proposed ICI acquisition, there are concerns regarding the financing of it. Moreover, rising commodity costs are negatively affecting margins. The company is also facing a difficult environment in Europe. Currently, Akzo is trading at 13.6x our 2007 earnings estimate of $5.85 per ADR. Its continued efforts at cost control, aimed at offsetting the present economic challenges, make us believe that it deserves to trade at a higher P/E multiple.

'However, the higher material costs and increased R&D expenditure are two of the factors that will weigh on the stock s performance in the near term. The uncertainty hanging over the ICI deal is further affecting the stock s performance. Hence, we recommend investors to Hold the stock. Using our fiscal year 2007 earnings estimate, and a forward multiple of 14.0x, we reiterate our six-month target price of $82.00.'