PPG merge commodity chemicals business with Georgia Gulf

PPG to merge commodity chemicals business with Georgia Gulf

5:50 AM, 23rd July 2012
PPG to merge commodity chemicals business with Georgia Gulf
Charles E Bunch, Chairman and CEO, PPG.

PITTSBURGH/ATLANTA, US: PPG Industries and Georgia Gulf Corporation have approved definitive agreements under which PPG will separate its commodity chemicals business and then merge it with Georgia Gulf. This business combination is expected to deliver enhanced value for the shareholders of both companies. The merger will result in PPG shareholders receiving approximately 50.5 per cent of the shares of the merged company, with existing Georgia Gulf shareholders owning approximately 49.5 per cent of The Newly Merged Company.

The transaction value of approximately $2.1 billion consists of $900 million of cash to be paid to PPG, approximately $95 million of assumed debt, about $87 million of minority interest, and Georgia Gulf shares to be received by PPG shareholders valued at $1.0 billion based on Georgia Gulf’s closing stock price on 18 July 2012. In the transaction, PPG will transfer related environmental liabilities, pension assets and liabilities and other post-employment benefits (OPEB) obligations to The Newly Merged Company.

“This is a unique opportunity to create significant value for PPG shareholders and to share in synergies that would not be available to PPG’s commodity chemicals business on its own. This further strengthens PPG’s already strong cash position and will provide us the opportunity to increase cash deployed for earnings-accretive activities such as acquisitions, organic growth initiatives, debt repayment and PPG share repurchases. Finally, we intend to maintain our dividend, and our long heritage of increasing our annual dividend payout,” said Charles E Bunch, Chairman and CEO, PPG.

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