Mexican glass manufacturer Vitro is to buy PPG’s flat glass business in a $750 million deal.
The transaction will allow Vitro to participate in the US market, in which it has no significant presence today.
The acquisition includes four of PPG’s manufacturing plants with a total of five furnaces in the United States, a flat glass research and development centre in Harmar, Pennsylvania, near Pittsburgh and four distribution and fabrication facilities in Canada.
Vitro’s Chairman of the Board of Directors, Adrián Sada González said: "Through this acquisition we will be putting together more than 200 years of experience in the production of glass and will continue to meet Vitro's commitment to our shareholders and stakeholders of creating value, by acquiring a leader in flat glass and glass coatings technology that participates in one of the most important and high value added markets in the world."
Vitro CEO, Adrián Sada Cueva, said: "This investment will strengthen our construction glass business, as it will allow us to participate in the US and Canadian markets and in the segment of high performance glass coatings in which we have no significant presence.”
This operation, based on 2015 figures, would have taken Vitro to a sales and EBITDA Pro forma figures of $1,444 million and $321 million respectively. The transaction is expected to close by the end of 2016, subject to customary closing conditions.
The four flat glass manufacturing and glass coatings operations are located in Fresno, California; Salem, Oregon; Carlisle, Pennsylvania; and Wichita Falls, Texas.
PPG’s flat glass business includes approximately 1200 employees. The business manufactures glass that is fabricated into products used primarily in commercial and residential construction.
“This transaction represents the end of an historic era for PPG as a manufacturer of flat glass, and it is another major step in our portfolio transformation to focus on paints, coatings and speciality materials,” said Michael H. McGarry, PPG president and chief executive officer.
“Upon completion of this transaction, the flat glass operations will become part of a company that is focused on growing its core glass business.”