PPG completes sale of Transitions Optical; acquisitions to come
PPG Industries Inc., the world's largest paint manufacturer wants to get bigger, and now has more money to do it.
PPG said on Tuesday that it completed the sale its Transitions Optical joint venture to partner Essilor International for $1.73 billion.
PPG had said it intends to use the money on acquisitions and to return cash to shareholders as it continues a growth strategy.
The deal included PPG's 51 percent ownership share of Transitions Optical, the inventor of plastic eyewear that darkens in bright sunlight, and PPG's wholly-owned sunlens business. PPG said it received about $1.5 billion after taxes.
In 2013, the Transitions Optical joint venture and sunlens business had combined sales of $874 million.
In January, PPG said it plans to spend up to $4 billion on acquisitions and repurchasing its shares.
“We will continue to focus on growing the company through acquisitions and capital spending,” said CEO Charles E. Bunch.
Last year, PPG sold its commodity chemicals business for $2.2 billion in January; purchased AkzoNobel NV's North American architectural coatings unit for $1.05 billion in April, which moved PPG into the No. 1 spot in paint worldwide; and in July, announced the sale of Transitions Optical.
The Downtown-based company will use money from the Transitions sale, $1.75 billion in cash on hand, plus cash generated in this year and in 2015, to fund that plan, without borrowing, said Chief Financial Officer Frank S. Sklarsky.
Acquisition talks are “very active from a discussion standpoint,” Bunch said. “We hope to realize some acquisition in 2014, but we are maintaining our disciplined approach.”
Over the last 15 years, and more aggressively during the last five, PPG has made 30 acquisitions that have moved it into the top position worldwide in paint — called “coatings” by the industry.
PPG said that Dave Cole, former president of Transitions Optical, has been appointed vice president, packaging coatings.
John D. Oravecz is a staff writer for Trib Total Media. He can be reached at 412-320-7882 or joravecz@tribweb.com.
