PPG to acquire chlor-alkali manufacturer Equa-Chlor
PITTSBURGH, March 21, 2011 – PPG Industries (NYSE: PPG) today announced that it has reached an agreement to purchase certain assets of Equa-Chlor, Inc., a producer of chlorine, caustic soda and muriatic acid. Equa-Chlor, a privately-held company with 65 employees, maintains its singular manufacturing site and business headquarters in Longview, Wash. The deal is expected to close during the first half of 2011, subject to normal closing conditions. Financial terms were not disclosed.
“With the acquisition of Equa-Chlor, PPG’s chlor-alkali and derivatives business will gain a strategic foothold in the western United States, in addition to improving our ability to supply key customers throughout the country,” said Michael H. McGarry, PPG senior vice president, Commodity Chemicals. “We believe Equa-Chlor will be a nice complement to PPG’s chlor-alkali and derivatives business.”
“We believe this is an outstanding development for our customers, employees and other business partners,” said Clay Pace, president and CEO of Equa-Chlor. “We are committed to a seamless transition for all of our employees and business partners, building on the respective strengths of PPG and Equa-Chlor.”
PPG plans to acquire Equa-Chlor’s manufacturing operations, which produce approximately 220 tons per day of chlorine. In addition, PPG will acquire Equa-Chlor’s railcars, which PPG can integrate into its existing fleet. This will enable PPG to optimize overall railcar usage, reducing future capital requirements and logistics costs. In addition, PPG expects to achieve synergies related to administrative functions and to reduce overall U.S. transportation costs given Equa-Chlor’s geographic position. The acquisition is expected to be accretive to PPG earnings within the year and to generate positive cash flow from operations in 2011.
PPG currently manufactures chlor-alkali and derivates products in Lake Charles, La., Natrium, W.Va., Beauharnois, Quebec, Canada, and through a majority-owned subsidiary in Kaohsiung, Taiwan. These products are essential to everyday life and are used in many end-use markets, such as purifying drinking water and making bleach, paper and pharmaceuticals.
PPG Industries’ vision is to continue to be the world’s leading coatings and specialty products company. Founded in 1883, the company serves customers in industrial, transportation, consumer products, and construction markets and aftermarkets. With headquarters in Pittsburgh, PPG operates in more than 60 countries around the globe. Sales in 2010 were $13.4 billion. PPG shares are traded on the New York Stock Exchange (symbol: PPG). For more information, visit www.ppg.com.
Statements in this news release relating to matters that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 reflecting the company’s current view with respect to future events or objectives and financial or operational performance or results. The forward-looking statements contained herein include statements relating to the timing and expected benefits of the acquisition. Actual events may differ materially from current expectations and are subject to a number of risks and uncertainties, including the failure to achieve the expected benefits of the acquisition and the other risks and uncertainties discussed in PPG Industries’ periodic reports on Form 10-K and Form 10-Q, and its current reports on Form 8-K filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date of their initial issuance, and PPG Industries does not undertake any obligation to update or revise publicly any forward-looking statement, whether as a result of new information, future events or otherwise.
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