Transaction adds architectural coatings presence in Mexico and Central
America
PITTSBURGH, Jun 30, 2014 (BUSINESS WIRE) --PPG Industries (NYSE:PPG) today announced that it has reached a
definitive agreement to acquire Consorcio Comex, S.A. de C.V. (“Comex”),
an architectural and industrial coatings company with headquarters in
Mexico City, Mexico. The transaction is valued at $2.3 billion and is
subject to regulatory approvals and customary closing conditions.
(Additional information is available at http://newsroom.ppg.com/.)
Comex manufactures coatings and related products in Mexico and sells
them in Mexico and Central America through approximately 3,600 stores
that are independently owned and operated by more than 700
concessionaires. Comex also sells its products through regional
retailers, wholesalers and direct sales to customers. The company has
approximately 3,900 employees, eight manufacturing facilities and six
distribution centers, and had sales of approximately $1 billion in 2013.
Comex is a privately-held company that was founded in 1952.
“Comex is a high-quality, well-managed business with a long heritage of
excellent customer service and leading, well-recognized regional
brands,” said Charles E. Bunch, PPG chairman and CEO. “The acquisition
is very complementary to PPG as it adds a leading architectural coatings
business in Mexico and Central America, a region where we have
negligible architectural coatings presence. We are excited to
participate in the growing Mexican economy and look forward to working
with the Comex team as we integrate the business into PPG,” Bunch
concluded.
Marcos Achar Levy, CEO of Comex, commented, "In these times of
globalization and highly competitive markets, strategic alliances allow
the development of companies and its individuals. We are excited to
proudly join the PPG team, a company with over 130 years of experience
that admires and respects Comex’s achievements over more than 60 years.
Being part of PPG gives us new opportunities and synergies that will
allow us to continue to significantly grow in our markets."
Bunch said that PPG plans to fund the acquisition primarily using
currently held cash and short-term investments, but he indicated that
the company may fund a portion of the purchase price through the
addition of debt. Bunch added that excluding non-recurring
acquisition-related costs the deal will be immediately accretive to
earnings, and that the Company anticipates acquisition-related synergies
of 3 to 4 percent of acquired sales will be achieved over a two-year
period.
“This acquisition is consistent with our stated strategy to expand our
global coatings business portfolio,” Bunch said. “Following this
transaction, we will continue to have a strong cash balance, expanded
free cash flow and a high degree of financial flexibility, and we expect
additional, disciplined cash deployment focused on value creation for
our shareholders,” Bunch concluded.
PPG reported $3.0 billion of cash and short-term investments on hand as
of March 31, 2014. On April 17, 2014, PPG’s Board of Directors approved
a $2.0 billion share repurchase authorization and increased the
quarterly dividend payable June 12, 2014, by 10 percent versus the
previous quarterly dividend.
Conference Call and Webcast Details
PPG will provide a presentation at 10 a.m. ET regarding the acquisition
on the investor center at the company’s website at www.ppg.com/corporate/investorcenter.
The company will host a conference call today, June 30, at 11 a.m. ET.
The conference call dial-in numbers are: in the United States,
866-318-8618; international, 617-399-5137; passcode 20688086. The
conference call also will be available in listen-only mode via Internet
broadcast from the Investor Center of PPG’s website.
A telephone replay will be available today, June 30, beginning at
approximately 1 p.m. ET, through Monday, July 7, at 11:59 p.m. ET. The
dial-in numbers for the replay are: in the United States, 888-286-8010;
international, 617-801-6888; passcode 36568515. A Web replay also will
be available on PPG’s Investor Center.
PPG: BRINGING INNOVATION TO THE SURFACE.(TM)
PPG Industries' vision is to continue to be the world’s leading coatings
and specialty materials company. Through leadership in innovation,
sustainability and color, PPG helps customers in industrial,
transportation, consumer products, and construction markets and
aftermarkets to enhance more surfaces in more ways than does any other
company. Founded in 1883, PPG has global headquarters in Pittsburgh and
operates in nearly 70 countries around the world. Reported net sales in
2013 were $15.1 billion. PPG shares are traded on the New York Stock
Exchange (symbol: PPG). For more information, visit www.ppg.com
and follow @PPGIndustries
on Twitter.
Forward-Looking Statements
This news release contains certain statements about PPG Industries,
Inc., that are “forward-looking statements” within the meaning of the
U.S. Private Securities Litigation Reform Act of 1995. These matters
involve risks and uncertainties as discussed in PPG’s periodic reports
on Form 10-K and Form 10-Q and its current reports on Form 8-K filed
from time to time with the Securities and Exchange Commission.
The forward-looking statements contained in this news release may
include statements about the expected effects on PPG of the acquisition
of Consorcio Comex, S.A. de C.V. (the “Transaction”), the anticipated
timing and benefits of the Transaction, including expected synergies,
the expected methods of financing the Transaction, PPG’s expected cash
balance, free cash flow, financial flexibility, future cash deployment
plans, and all other statements in this news release that are not
historical facts. Without limitation, any statements preceded or
followed by or that include the words “targets,” “plans,” “believes,”
“expects,” “intends,” “will,” “likely,” “may,” “anticipates,”
“estimates,” “projects,” “should,” “would,” “could,” “positioned,”
“strategy,” “future,” or words, phrases or terms of similar substance or
the negative thereof, are forward-looking statements.
These statements are based on the current expectations of the management
of PPG and are subject to uncertainty and to changes in circumstances
and involve risks and uncertainties that could cause actual results to
differ materially from those expressed or implied in such
forward-looking statements. In addition, these statements are based on a
number of assumptions that are subject to change. Such risks,
uncertainties and assumptions include: the satisfaction of the
conditions to the Transaction and other risks related to the completion
of the Transaction and actions related thereto; the parties’ ability to
complete the Transaction on the anticipated terms and schedule,
including the ability to obtain regulatory approvals; risks relating to
any unforeseen liabilities, future capital expenditures, revenues,
expenses, earnings, synergies, economic performance, indebtedness,
financial condition, losses and future prospects; business and
management strategies and the expansion and growth of PPG’s operations;
PPG’s ability to integrate the acquired business successfully after the
closing of the Transaction and to achieve anticipated synergies; and the
risk that disruptions from the Transaction will harm PPG’s businesses.
However, it is not possible to predict or identify all such factors.
Consequently, while the list of factors presented here is considered
representative, no such list should be considered to be a complete
statement of all potential risks and uncertainties. Unlisted factors may
present significant additional obstacles to the realization of
forward-looking statements.
Forward-looking statements included herein are made as of the date
hereof, and PPG undertakes no obligation to update publicly such
statements to reflect subsequent events or circumstances.
Bringing innovation to the surface is a trademark of PPG
Industries Ohio, Inc.
SOURCE: PPG Industries, Inc.
PPG Industries, Inc.
Media:
Mark Silvey, PPG Corporate
Communications, 412-434-3046
silvey@ppg.com
newsroom.ppg.com
or
Investors:
Vince
Morales, PPG Investor Relations, 412-434-3740
vmorales@ppg.com
www.ppg.com/investor