Belgian glass manufacturer Glaverbel SA has announced that it is to sell its remaining stake in US glassmaker AFG Industries to its controlling shareholder, Japan“s Asahi Glass Co. Ltd., for BFr 9.6 …
Belgian glass manufacturer Glaverbel SA has announced that it is to sell its remaining stake in US glassmaker AFG Industries to its controlling shareholder, Japan“s Asahi Glass Co. Ltd., for BFr 9.6 billion (US$ 307.1 million). The deal will allow the Belgian glassmaker to concentrate on its core European and new emerging markets. The sale includes both Glaverbel“s 41.76% holding of AFG common stock and its 36.05% stake in non-voting preferred stock in Clarity Holdings Corp., the holding company that owns AFG. The cash raised will help Glaverbel cut its debt to around BFr 15 billion from BFr 21 billion, bringing its debt-to-equity ratio in line with its main competitors, and increase the chance that the company will pay an interim dividend in 1996. Glaverbel was forced to cut its 1995 gross dividend to BFr 84 from BFr 112 in 1994 to strengthen its debt-laden balance sheet despite reporting a profit of BFr 621 million, its first positive result since 1992. The remainder of the cash would be used to buy the remaining 27% of Czech glassmaker Glavunion AS that Glaverbel does not already own, as well as a small European distribution company, Glaverbel“s chief executive officer Luc Willame said. Glaverbel first bought into the Czech company in 1991. Glaverbel also has high hopes for Latin America from its Brazilian float and auto glass venture due to the fact that, according to Mr. Willame, demand from the automobile and building industries is picking up. Glaverbel also reported in June that it was expecting first-half 1996 results to be below expectations but still positive. As reported in Glass-Technology International No. 4-96, the Belgian company had previously announced that first quarter 1996 sales fell 8% to BFr 8.7 billion due to the combined effects of the lowest glass prices for years and the hard winter, which cut demand for construction glass from building sites. Furthermore, Glaverbel has announced that it is to increase the price of blank float glass on the German market by about 10%, in response to a similar move by Pilkington Plc of the UK. A Glaverbel spokeswoman said the price would rise to between DM 5 and DM 6 per sq. m.. She also said that blank float glass was a “basic glass” which served as indicator for other kinds of glass; as a result, the rest are expected to follow suit.