Georgia Gulf rejects Westlake’s acquisition proposal

Georgia Gulf rejects Westlake’s acquisition proposal

9:51 PM, 16th January 2012
Georgia Gulf rejects Westlake’s acquisition proposal
Paul Carrico, President and CEO, Georgia Gulf.

ATLANTA, US: Georgia Gulf rejected Westlake Chemical’s unsolicited proposal to acquire Georgia Gulf for $30.00 per share. “After careful consideration, Georgia Gulf’s board determined that Westlake’s proposal is financially inadequate. The Westlake proposal is an opportunistic attempt to acquire the company’s uniquely positioned assets as we recover from an unprecedented downturn in the industries we serve and a volatile public equity market and thereby deprive our stockholders of the company’s inherent value,” informed Paul Carrico, President and CEO, Georgia Gulf.

In a letter to, Albert Chao, President and CEO of Westlake, Georgia Gulf communicated its response stating that the proposal took advantage of a dislocation in public market valuations in order to deprive company stockholders of the intrinsic value in their investment. The letter mentioned that the Westlake proposal undervalued the company by failing to acknowledge Georgia Gulf’s significant ability to leverage improving global PVC demand and its access to comparatively low-cost US shale gas.

Also, the Georgia Gulf’s board believed that the Westlake offer was not compelling as it reflected only a 23 per cent premium to Georgia Gulf’s last trading price of $24.48 per share. The proposal also represents a discount of 26 per cent of their 52-week high. Additionally, Georgia Gulf has adopted a stockholder rights plan. The rights will expire on December 31, 2012, unless redeemed or the rights plan is amended.

© WOC News



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