PPG announced that it has reached a definitive agreement to sell its remaining fiberglass operations to Nippon Electric Glass Co. Ltd. (NEG), a leading manufacturer of fiberglass.
The transaction is expected to close in the second half of 2017, subject to customary closing conditions. Pre-tax proceeds from the sale are approximately $545 million, and are subject to customary closing adjustments.
PPG’s remaining fiberglass operations include manufacturing facilities in Chester, South Carolina, and Lexington and Shelby, North Carolina; and administrative and research-and-development operations in Shelby and in Harmar, Pennsylvania, near Pittsburgh.
The business, which employs more than 1,000 people and had net sales of approximately $350 million in 2016, supplies the transportation, energy, infrastructure and consumer markets.
In 2016, PPG completed the sale of its European fiberglass operations to NEG and divested its ownership interests in two Asian fiberglass joint ventures. PPG also completed the sale of its North American flat glass business in 2016.
“We considered all of the strategic alternatives for the business and factored potential impacts to stakeholders. We are pleased that these operations will become part of NEG, a company that is focused on fiberglass as a core business,” said Michael H. McGarry, PPG chairman and chief executive officer.
“This transaction represents the end of PPG’s history as a manufacturer of fiberglass and is the final action in our disciplined, multiyear strategy to divest non-core businesses. Going forward, we will continue to focus on growing our paints, coatings and specialty materials businesses. I want to personally thank our fiberglass employees for their contributions and dedicated support of PPG, and wish them well as they establish the North American fiberglass business of NEG.”