Kohlberg & Company LLC and PPG Industries Inc agreed to sell Pittsburgh Glass Works, an automotive glass and services business, to LKQ Corp for an enterprise value of USD635 million.
PPG sold a majority stake in Pittsburgh Glass Works to Kohlberg & Co in 2008. Jefferies and Nomura Securities International served as financial advisor, and Ropes and Gray LLP acted as legal counsel, to Pittsburgh Glass Works. K&L Gates served as legal counsel to LKQ.
LKQ Corporation is to acquire Pittsburgh Glass Works (PGW) from private equity firm Kohlberg & Company (Kohlberg) and PPG Industries for an enterprise value of USD635 million.
PGW is a global distributor and manufacturer of automotive glass products. The firm’s business comprises wholesale and retail distribution services, automotive glass manufacturing, and retailer alliance partnerships. PGW operates approximately 120 distribution branches serving over 7,000 automotive glass retailer shops across North America. In addition, PGW operates 12 automotive glass fabrication facilities in North America, Europe and China.
The transaction is expected to be completed in the second quarter of 2016 and is subject to customary closing conditions and necessary regulatory approvals.
“We are excited to be partnering with PGW, and look forward to working with the existing core management team at PGW to continue to invest in and grow its business while continuing the high quality service to all its customers. PGW reflects LKQ’s commitment to provide a one-stop-shop solution to the North American collision repair industry by adding automotive glass to our product offerings. PGW is the largest pure-play provider in the USD3.5 billion North American automotive glass market. This acquisition will expand our addressable market in North America and globally; and simultaneously offers tremendous distribution synergy opportunities with our existing network,” says Robert L Wagman, President and Chief Executive Officer of LKQ Corporation.
Jim Wiggins, Chairman and CEO, Pittsburgh Glass Works, says: “PGW transformed itself into a strong global competitor of automotive glass and enjoyed tremendous market and financial success under the stewardship of Kohlberg and PPG. We are excited to become part of the LKQ family, and expect that the Company will continue on its growth and success trajectory under LKQ.”
PGW’s revenue for the twelve months ended 31 October, 2015 was approximately USD1.07 billion, and LKQ expects the transaction to be accretive to its earnings in 2016. These projected results exclude restructuring and acquisition related expenses.
The Company intends to finance the acquisition with borrowings under its revolving credit facility. As of 25 February, 2016, the company had approximately USD2.2 billion of available borrowing capacity on its credit facility.
Jefferies LLC and Nomura Securities International served as financial advisor, and Ropes and Gray LLP acted as legal counsel, to PGW. K&L Gates LLP served as legal counsel to LKQ.
