PPG sells US & Canada coatings business to AIP for $550 mn

PPG (NYSE: PPG) announced that it has completed the sale of 100% of its architectural coatings business in the U.S. and Canada at a transaction value of $550 million to American Industrial Partners (AIP), an industrials investor.

PPG’s architectural coatings businesses in other regions around the world remain core businesses within the company’s portfolio, including in Latin America, Europe and Asia Pacific, where PPG holds strong #1 or #2 positions in a number of key countries.

“We are pleased to complete this transaction with American Industrial Partners, and I want to thank the architectural coatings U.S. and Canada employees for their dedication and commitment to the business and to PPG customers throughout the years,” said Tim Knavish, PPG chairman and chief executive officer. “This transaction, along with the completed sale of our silicas products business, further optimizes our portfolio by improving our organic growth and financial return profiles and will result in increased capability to channel our growth resources to areas where we have the strongest right to win with our customers.”

The architectural coatings business in the U.S. and Canada represented approximately $2 billion of PPG’s 2023 total net sales, with low-single-digit EBITDA margin. As previously stated, on a 3-year pro forma basis PPG’s overall company sales volume results would have improved cumulatively by over 200 basis points excluding this business. Also, the company’s Performance Coatings segment operating (EBIT) income, excluding the U.S. and Canada architectural coatings EBIT and the associated growth-related investments we have made, would have resulted in an approximately 300-basis point improvement in segment margins in 2023.

The transaction is the result of PPG’s evaluation of strategic alternatives for the business, which was first announced on February 26, 2024. Goldman Sachs & Co. LLC acted as PPG’s exclusive financial advisor and Hogan Lovells U.S. LLP served as its legal advisor.

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Fibre2Fashion News Desk (HU)