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 Construction Materials Mergers & Acquisitions Pipe/Profile/Tubing Suppliers
Companies & Associations

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

ACO Polymer moves into larger location

March 31, 2015 3:17 pm ET

Polymer and concrete drainage management systems major ACO Polymer Products Inc. has moved a new manufacturing operation within Ohio.    More

Market Reports

Flexible Packaging Trends in North America

North America represents about 30 percent of the global consumption of flexible packaging. Annual growth in this region is forecast at 4 percent during the next 5 years.

For more insight on growth opportunities, drivers of growth and the outlook for 2015, download this report.

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

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 billion plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our analysts provide insight on business trends, foreign investment, top end markets and plastics processing activity. The report also provides important data on exports, production, employment and value of plastics products manufactured.

Learn more

Upcoming Plastics News Events

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

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

More Events