This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

PPG Reaches Agreement To Divest Ownership Interest In Transitions Optical Joint Venture

PPG Industries, Inc. (NYSE:PPG) today announced it has reached an agreement to divest its 51 percent interest in Transitions Optical to Essilor International, which currently holds a 49 percent interest in the venture. Transitions Optical is a global supplier of photochromic lenses and a consolidated subsidiary of PPG. Essilor will also enter into multi-year agreements with PPG for continuing supply of optical dyes and research and development services and acquire PPG’s optical sunlens business.

"Transitions has been an excellent growth catalyst for PPG for more than 20 years," said Charles E. Bunch, PPG chairman and CEO. “However, the optical industry is changing rapidly, including the emergence of new technologies. The completion of this transaction will position Transitions as a core business within a leading global optical industry company. We are pleased with the enterprise value of the transaction, which reflects a valuation multiple midway between PPG’s and Essilor’s multiples, benefiting both parties. Additionally, PPG will remain an important supplier of optical materials to the industry, including to Essilor.”

“We intend to redeploy the proceeds from the transaction in a timely manner on core business acquisitions and share repurchases,” Bunch said. “The earnings benefits from this cash deployment are expected to more than offset the reduced earnings from the Transitions Optical divestment. Additionally, we suspended share repurchase activity at the outset of the second quarter due to ongoing negotiations, and are now reinitiating repurchases targeting a range of $500 to $750 million for the year.”

The transaction reflects an enterprise value of approximately $3.4 billion, with PPG receiving cash at closing of $1.73 billion pre-tax or approximately $1.5 billion after-tax, subject to certain post-closing working capital and net debt adjustments. In 2012, Transitions Optical had net sales of approximately $800 million. The transaction is expected to close in the first half of 2014, subject to satisfaction of customary closing conditions, including receipt of regulatory approvals.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

DOW 17,757.91 +138.40 0.79%
S&P 500 2,077.42 +14.31 0.69%
NASDAQ 5,013.1230 +26.2560 0.53%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs