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* Deal to boost Sherwin's presence in Mexico, Canada, parts of U.S.
* Sees deal adding modestly to earnings per share in first 12 months
* Sees deal adding more than $1 per share by third year
Nov 12 (Reuters) - Sherwin-Williams Co, the top U.S. paint maker, said it will buy Mexico's leading paint company Consorcio Comex for about $2.34 billion, including debt, to tap into the rising demand in the region.
Shares of Sherwin-Williams were up 7 percent at $151.05 on the New York Stock Exchange on Monday.
The deal will significantly increase Sherwin-Williams' presence in markets where its store count is low, Chief Executive Christopher Connor said in a statement.
"There's an estimated housing deficit in the range of 9 million units, plus ongoing annual demand of 600,000 units, in Mexico," Connor said on a conference call. "So it's a pretty healthy market."
Sherwin-Williams has 135 stores in Mexico.
The U.S. company noted that 40 percent of Mexico's population is aged between 10 and 44, pointing to the strong growth potential in housing demand.
Comex, which sells paint and coatings through 3,300 outlets in Mexico, generated sales of about $1.4 billion in 2011.
About $1 billion of this comes from Mexico, Robert W. Baird & Co analyst Ghansham Panjabi said.
Comex acquisition will also boost Sherwin-Williams' presence in the U.S. West Coast and Canada.
"Coatings is still a consolidating industry. This is just a part of a natural consolidation cycle," Panjabi said.
Comex was founded as a family business in the 1950s by Jose Achar, a descendent of Syrian immigrants, who started mixing paints in a garage in Mexico City using a World War One mill.
The company is now the top paint manufacturer in Mexico and Central America.
"Sherwin Williams is obviously one of the leaders globally and they just found a very nice fit with a well-managed company," Panjabi said.
Sherwin-Williams, which sells Dutch Boy, Krylon, Minwax, Water Seal and its namesake brands, operates about 3,880 stores in the United States, Canada, Puerto Rico and Virgin Islands.
The company, which has a market value of about $14.5 billion, expects the deal to add modestly to earnings in the first year and more than $1 per share by the third year.