Westlake making unsolicited bid for Georgia Gulf

By Frank Esposito
Senior Staff Reporter

Published: January 13, 2012 6:00 am ET

Related to this story

Topics Materials, Mergers & Acquisitions, Suppliers, Construction, Pipe/Profile/Tubing

HOUSTON (Jan. 13, 1 p.m. ET) — Westlake Chemical Corp. is making an unsolicited run at Georgia Gulf Corp., offering $30 per share in cash for all of Georgia Gulf’s outstanding shares.

The offer represents a 51 percent premium to Georgia Gulf’s 30-day average share price, which was just under $20. If accepted, the deal would add significantly to Westlake’s assets in PVC resin and related downstream products, as well as in plastic feedstocks.

In a Jan. 13 news release, officials with Houston-based Westlake said that they had first contacted Georgia Gulf officials in September, but had received little reply, and as a result were taking their offer public.

“We believe that our proposal represents a unique opportunity to deliver significant and immediate value to Georgia Gulf stockholders,” Westlake president and CEO Albert Chao said in the release. “As such, we are surprised and disappointed that Georgia Gulf’s management has been unwilling to engage in substantive discussions with us.”

Officials with Atlanta-based Georgia Gulf could not be reached for comment. The firm has struggled since 2006 to digest its $1.6 billion acquisition of building products maker Royal Group Inc. In the first nine months of 2011, Georgia Gulf’s sales grew 20 percent to more than $2.5 billion, and its profit more than doubled to $61 million. But in 2010, the firm’s profit had fallen almost 70 percent, even as sales grew more than 40 percent to $2.8 billion.

Both firms rank among North America’s largest PVC makers. Georgia Gulf also is a major PVC compounder, while Westlake ranks among the region’s largets makers of low density polyethylene. Both firms also make several other specialty chemical products, including plastic feedstocks.

News of the Westlake offer sent Georgia Gulf’s per-share stock price up almost 35 percent to $33 in mid-day trading Jan. 13.


Comments

Westlake making unsolicited bid for Georgia Gulf

By Frank Esposito
Senior Staff Reporter

Published: January 13, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

Ferro sells another piece of its plastics business

December 19, 2014 3:33 pm ET

Ferro Corp. has sold its North American polymer additives business to a private equity firm for $154 million in cash.    More

Image

Alex Brands buys iconic Shrinky Dinks toys

December 19, 2014 3:15 pm ET

First Slinky, now Shrinky Dinks. What will toy and games investment firm Alex Brands buy next?    More

Image

Judge limits scope of jury verdict against JM Eagle

December 19, 2014 2:30 pm ET

A federal judge in Los Angeles said Dec. 18 that last year's jury verdict issued against J-M Manufacturing Co. — now JM Eagle — for...    More

Image

The return of HPM's big presses

December 19, 2014 11:47 am ET

HPM is back in big injection molding machines.    More

Image

Antimicrobial polymers firm TiFiber launching pilot production in Ark.

December 19, 2014 10:58 am ET

TiFiber Inc., which makes synthetic compounds to control dangerous microorganisms, will locate a pilot production facility and its future company head...    More

Market Reports

Flexible Packaging Trends in North America

Our latest RESEARCH report examines trends in FLEXIBLE PACKAGING impacting the North American market including a review of economic conditions, key drivers of growth, materials pricing, M&A activity, sustainability challenges and the outlook for 2015.

Learn more

Plastics in Brazil - State of the Industry Report

This in-depth report examines the Brazilian plastics industry from a historical and geographical context. Our analysts provide insight on economic trends and forecasts, growing manufacturing sectors that utilize plastics, private investment opportunities, market environment challenges, and innovations in R&D.

Data tables and charts on producer prices, trade, plastics production and end market indicators is also included.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

October 27, 2015 - October 29, 2015Plastics Financial Summit - New York - 2015

More Events