Georgia Gulf to buy PPG’s commodity chemicals business
In a move to expand its chlorine-based business, chemical supplier Georgia Gulf Corp. will buy PPG Industries Inc.’s commodity chemicals company for US$900 million in cash and US$1 billion in shares.
PPG, based in Pittsburgh, is forming a separate company to include its commodity chemicals company, according to a company statement. The company will then be sold to Atlanta-based Georgia Gulf.
The proposed transaction would create one of the largest producers of chlor-alkalis, used to make PVC windows, pipes and sidings, as well as hydrochloric acid, where demand has surged because of its use in extracting shale gas.
“The combined company will be a leading integrated chemicals and building products company that we believe will benefit from significant integration and scale, a broad portfolio of downstream products, as well as the regional advantage of low-cost North American natural gas,” Georgia Gulf president and CEO Paul Carrico said in a Georgia Gulf news release.
The acquisition is expected to be completed late this year or early next year. The merged company expects to have an annual revenue of US$5 billion, according to the statement.