18 June 1998: The US group PPG Industries has reportedly walked away from a possible bidding war over London-based Courtaulds Plc, accepting a smaller consolation prize.
The Pittsburgh-based glassmak…
18 June 1998: The US group PPG Industries has reportedly walked away from a possible bidding war over London-based Courtaulds Plc, accepting a smaller consolation prize. The Pittsburgh-based glassmaker, paints and chemicals firm announced it would pay about US$ 285 million in cash for the packaging coatings and US architectural coatings businesses of the British chemical company, only a small portion of Courtaulds“ total coatings business, which reported about US$ 1.6 billion in sales in the year ended in March. The rest of Courtaulds will be absorbed by Akzo Nobel N.V., a Dutch company that had announced plans in April to pay about US$ 3 billion in its bid to become the world“s largest paintmaker. Courtaulds“ shareholders were expected to approve the sale last week. Despite the earlier agreement, PPG announced in May that it might make a competing bid. PPG wanted only the coatings division, and DLJ Merchant Banking would have acquired the fibre and polymer divisions. “I don“t think (PPG) went into this deal trying to pressure Akzo Nobel,” one analyst told reporters. “I think they really wanted the Courtaulds“ business.” PPG Chairman and Chief Executive Officer Raymond W. LeBoeuf has said he would like to increase his company“s sales to US$ 10 billion by 2000. The company currently has about US$ 7.38 billion in sales. It is believed that PPG and DLJ were unable to agree on a price that DLJ should pay for Courtaulds“ fibres business, and that the figures could not beat Akzo“s 450p per share offer. Akzo recently acquired 10% of Courtaulds shares.