The world's biggest coatings maker and the top foreign coatings company in China has relatively low exposure in China's decorative painting market despite its strong presence in the industrial sector. Nippon Paint Co and the UK's ICI Group, which makes Dulux-brand paints, are the leaders.

"That will change," said Hans Wijers, Akzo's chairman and chief executive. "We will invest more money in commercial information to strengthen brand awareness. We will also launch new products."

The company acquired a Chinese rival, Toide Paint, in Guangdong Province late last year to access distribution channels, a key to the decorative painting business.

Wijers said there could be more such purchases. Akzo now has 13 coatings plants in China and a new one under construction, Wijers said.

The coatings business accounted for 70 percent of Akzo's US$750 million sales in China last year, compared with US$600 million in 2004. It is expected to reach US$800 million this year.

The company earlier targeted US$1 billion in China sales by 2010, which Wijers said is no longer a stretch goal given the recent robust growth.

He also said Akzo is seeking to integrate its scattered chemicals businesses in China. Chemical sales represent 25 percent of the company's total China sales.

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