PPG said that the deal, which is expected to close in late 2024 or early 2025, is the result of its evaluation of strategic alternatives for the business, which was first announced in February 2024. The transaction is subject to customary closing conditions.

Along with the divestiture agreement, PPG also announced a comprehensive cost reduction program with anticipated annualized pre-tax savings of approximately $175 million once fully implemented, including savings of $60 million in 2025. The multi-year program is focused on reducing structural costs primarily in Europe and in certain other global businesses, along with other corporate costs following the two recently announced agreements to sell PPG’s silicas products business and the architectural coatings business in the US and Canada. The program includes various facility closures and other targeted fixed costs. In total, PPG expects the cost reduction program to impact about 1,800 positions, primarily in Europe and the US.

“From a PPG perspective, this transaction, along with the pending sale of our silicas products business, demonstrates the active portfolio management by the company and our board. These divestitures further optimize our portfolio by improving our organic growth and financial return profiles and will result in increased capability to channel our growth resources to areas where we have the strongest right to win with our customers,” said Tim Knavish, PPG’s CEO.

Knavish added: “In addition, we are taking decisive self-help actions to reduce our overall cost structure. While these decisions are difficult, they are necessary to adjust our fixed cost base and to right-size our company following these two business divestitures. None of these actions will impact our ongoing investments or focus on organic growth.”

The architectural coatings business in the US and Canada represented roughly $2 billion of PPG’s 2023 total net sales, with low-single-digit EBITDA margin.