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PPG Industries

PPG Industries (NYSE: PPG)

Website: http://www.ppg.com

Company Description

PPG is the largest US paint company and has been a major producer of glass. (Pittsburgh Plate Glass Co.) It is a leading supplier of glass and paints to the automotive industry and is especially well known for its Uniprime electrodeposition primers. It also offers a full range of paint products including Olympic Stain and Lucite house paint, Liquid Nails and auto refinish enamels, used in auto repair, as well as PPG Pittsburgh Paints sold through PPG Paint Stores. PPG is a global player with subsidiaries and/or operations everywhere.

In December, 2012 PPG announced the acquisition of the North American consumer paints business (usually called "trade sales") from Akzo Nobel. Akzo presumably got it with the portion of ICI they acquired. This includes the Glidden brand name, which has a long history (at one time owned by SCM, but makers of Smith Corona typewriters and Durkee dressing). Dulux, Sico, and CIL (Canada) are additional brand names acquired. According to a Wall Street Journal article, this will make PPG the world's largest paint company followed by Akzo and Sherwin-Williams. Sherwin-Williams is still the largest in the North American architectural paints business, followed by PPG and then Masco, maker of Behr paints. Sherwin Williams has 3500 company paint stores; PPG will have 1000.

In July, 2012, Georgia Gulf announced plans to merge with the commodities chemicals business being spun off from PPG Industries. The PPG products are primarily chlor-alkali. The combined companies will be the third largest producer of chlor-alkali in the US after Dow Chemical and Occidental. PPG will own 50.5% of the combined companies.

Chlor-alkali consists of the production of chlorine and usually sodium hydroxide (aka caustic soda or lye) by electrolysis of salt. Chlorine is used primarily to make PVC plastic; caustic soda is a major source of sodium in a variety of industries. This is the classical co-product situation in that chlorine cannot be stored and the two products have different demand/growth cycles. Keeping them in balance is usually accomplished by raising prices on one and cutting on the other, but it's a roller coaster for all involved.

The prospectus indicates that PPG also makes chlorine derivatives including calcium hypochlorite (aka chlorinated lime), chlorinated solvents, and phosgene derivatives. These businesses too are going to Georgia Gulf. Glass, fiberglass, optical plastics, and silica are being retained.

The new company formed from the chemical division of PPG combined with Georgia Gulf is to be called Axiall Company.

The 2013 Annual Report indicates PPG acquired Deft Inc in May enhancing its aerospace coatings portfolio. A new electronic materials division will market conductive inks and coatings and manufacture materials for organic light emitting diodes (OLED). Will divest its 51% interest in Transitions Optical lenses (jv with Essilor International).

Groups include--

Performance Coatings consisting of Aerospace (electrochromic window systems, transparent armour), Architectural Coatings, Automotive Refinish, Protective/Marine Coatings (Amercoat, Freitag, Sigma Coatings).

Industrial Coatings: Automotive OEM, Industrial Coatings (appliances, construction equipment, electronics, auto parts, wood flooring, doors and windows), Packaging coatings (plastic tubes and metai containers for food and beverages)

Optical products/Specialty Materials: CR-39 monomer for light weight plastic lenses as well as coatings. Silicas.

Glass: Fiber glass and flat glass

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