UPDATE 1-Axalta ends Nippon Paint talks after rejecting $9.1 billion bid

(Adds details on Nippon talks, background on Akzo Nobel bid, share price)

Nov 30 (Reuters) - Axalta Coating Systems has ended talks with Japan's Nippon Paint Holdings Co Ltd about a potential sale, the U.S. coating company said on Thursday, following the rejection of what sources said was a $9.1 billion all-cash bid.

The development makes Nippon Paint the latest unsuccessful suitor for Axalta, whose largest shareholder is Warren Buffetts Berkshire Hathaway Inc. Axalta previously ended talks with Dutch paint maker Akzo Nobel NV about a merger earlier this month.

Axalta said Nippon Paint's board was "unwilling" to meet Axalta's expectations regarding the value of the company.

Nippon Paint's latest cash offer valued Axalta at $37 per share but Axalta wanted more, according to two people familiar with the matter who requested anonymity to discuss confidential details.

Axalta shares were trading in New York at $37.25 before they were halted on Thursday afternoon ahead of Axalta's announcement, indicating that investors were expecting a deal at a higher price. The shares dropped 17 percent on news of the terminated deal talks to $31.19.

A deal with either Nippon or Akzo Nobel was seen as attractive by Axalta, because neither suitor appeared to present significant antitrust risk with regulators. However, agreeing on financial terms proved challenging.

Axalta's talks with Akzo Nobel ended over disagreements about how much premium Axalta shareholders deserved in what was branded as a merger of equals. Akzo Nobel wanted its shareholders to own 63 percent of the combined company, which Axalta considered excessive, according to the sources.

Akzo Nobel also wanted to keep much of its current governance arrangements, including keeping the top job with Akzo Nobel CEO Thierry Vanlancker and maintaining the combined company Dutch with headquarters in Amsterdam, the sources added.

"We had a very strong click with Axalta, but we were only ever interested in a merger. We were never prepared to pay a premium for a takeover, partly because of the outlook for the automotive industry," Vanlancker told an Akzo Nobel shareholder meeting on Thursday. (Reporting by Greg Roumeliotis in New York,; additional reporting by Bart Meijer in Amsterdam; Editing by Andrew Hay)