PPG Industries sold its stake in PFG fiberglass joint venture
On September 22, PPG Industries (PPG) reached an agreement to sell its 50% stake in its two PFG fiberglass joint ventures to Nan Ya Plastics. On November 18, 2016, PPG announced the completion of this deal. Through this transaction, PPG Industries will receive gross proceeds of $170 million. Now, Nan Ya Plastics will have a 100% stake in PFG fiberglass. PFG was an equally held joint venture between PPG Industries and Nan Ya Plastics that was formed in 1987.
With PPG continuing to divest its non-core business in the fourth quarter, PPG Industries’ glass segment will include only the US and Canada Fiberglass business.
In other developments, Airbus selected PPG Coatings to paint one of its three Airbus A350-1000 flight test aircraft. PPG used DESOTHANE HD 9008 basecoat-clearcoat for high-intensity, long-lasting color while shortening the repainting cycle time. Daniel Bencun, PPG Aerospace coatings’ segment manager for the Europe, Middle East, and Africa region, said, “PPG is proud that Airbus has chosen advanced PPG paint systems for an aircraft that launches the new A350-1000.”
PPG stock price
As of November 18, 2016, PPG Industries closed at $95.19 and lost 0.6% for the week, while the Materials Select Sector SPDR ETF (XLB), which holds 4.4% in PPG as of November 18, rose 0.40% for the week and closed at $48.32. PPG peers Sherwin-Williams (SHW) and Valspar (VAL) dropped 0.6% and 1.0%, respectively, while RPM International (RPM) rose 1.8% for the same period. PPG’s stock closed 6.1% lower than the 100-day moving average price of $101.32, indicating a downward trend in the stock. Analysts expect PPG’s 12-month target price to be at $110.53, implying a potential return of ~16.1% over the closing price on November 18, 2016. On a year-to-date basis, PPG has dropped 3.7%.