PPG announced Thursday morning that it has reached a deal to sell its architectural paints business in the , U. S.  , and , Canada , in a transaction valued at$ 550 million.
Headquartered in , Cranberry, with more than 6, 000 employees and 750 company-owned stores, the paints section is probably the most recognized production for the regular retail client, who is used to seeing brands like , Glidden , on the shelves of hardware stores.
It is being sold to , American Industrial Partners, a , New York-based private equity funding company. PPG’s , U. S.  , and French colors business will be among the biggest in , American Industrial ‘s , collection, which includes dozens of firms in business, transportation, pesticides and other organizations.
The deal, subject to regulatory approvals, is expected to close slow this year or in earlier 2025, business leaders said. On a visit with investors, PPG said it will net about$ 450 million in cash to the company.
The Downtown-based company also announced a cost-cutting program that business leaders referred to as a” self-help” program. The software will result in the reduction of 1, 800 jobs at the business in the , U. S.  , and , Europe. These are related to the planned sale of the North American beautiful paints company.
According to PPG’s site, it now has about 50, 000 people worldwide, including some 18, 000 in the , U. S.  , and , Canada, 17, 000 in , Europe, the , Middle East , and , Africa, and the remainder divided between , Asia , and , Latin America.
PPG’s goal is to eliminate$ 175 million a year from its costs, which will involve closing some facilities. It’s not yet distinct which of PPG’s firms may bear the brunt of the breaks, but company officials indicated that poor need from manufacturers, particularly in , Europe, will guide some of those choices.
The pending price of the creates company to American Industrial Partners , hats a months-long corporate evaluation process at PPG that also included the purchase of its silicas company earlier this year.
” We actually had over 100 interested parties to begin with … and got 30 first bids, and so we had a very, very large group of attention” , , Tim Knavish, PPG chairman and chief executive officer, said during a visit with investors Thursday morning.
The deal includes manufacturing features in , Georgia,  , Kentucky,  , Ohio,  , Nevada,  , Texas,  , British Columbia , and , Ontario, distribution centers across the two countries, including one in , Reading, Pa., and assets at more than 15, 000 sales locations, including 750 PPG-owned stores, 6, 600 independent supplier locations, and 8, 100 major home improvement centers and merchant stores.
The headquarters for the business will remain in , Cranberry.
While many of the companies , American Industrial , has bought have been sold within five years, some have been held for a decade.
The deal does not include PPG’s architectural paints businesses in , Europe,  , Asia,  , Mexico , or , Latin America. It will also have no impact on the naming rights deal that PPG secured with the Penguins in , October 2016 , for , PPG Paints Arena.
“PPG continues to see value in , PPG Paints Arena , naming rights for our brand and business”, company spokesman , Mark Silvey , said on Thursday. ” We get a high level of interest from paint customers and employees coming to , PPG Paints Arena because the Penguins and the NHL overall have players from around the world.”
While waiting for the recovery of the automotive and industrial sectors, the company’s officials said that by dissolving its North American paints business, it will be able to concentrate on its high-growth areas like aerospace and infrastructure.
Even with one customer impacted by a strike,  , Mr. Knavish , said likely in reference to Boeing, the aerospace business is seeing no slowdown” and military is just red hot”, he said. According to him, PPG will increase capacity to meet the demand there.
The business announced its third quarter results on Wednesday evening. Net income for the quarter was$ 468 million, or$ 2 per diluted share, compared with$ 426 million, or$ 1.79 per share, during the three months ended , Sept. 30, 2023.
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( c ) 2024 the Pittsburgh Post-Gazette
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