Impact on Chillicothe uncertain after PPG deal with Kohlberg

PPG Industries has announced an agreement with a New York-based company to take over a majority of the company.

In a press release issued this week, Pittsburgh-based PPG announced they have signed a deal with Kohlberg & Company LLC under which PPG plans to divest it´s automotive glass and services business into a new company formed by Kohlberg. In Chillicothe, there are about 120 employees who work in automotive glass distribution and about 40 who work in the accounting center.

The glass distribution center will be included under the contract just signed with Kohlberg, said Jack Maurer, director of corporate communications for PPG. Under the deal, PPG will receive $330 million in gross cash proceeds and maintain an ownership of 40 percent of the company. After payments, fees and taxes, the transaction will result in about $270 million in cash coming to PPG.

PPG executives characterize the move as a positive one for their company.

"This transaction is another positive step forward in our portfolio transformation," said Charles E. Bunch, PPG chairman and chief executive officer. "It enables us to focus more on coatings and specialty products, and significantly reduces PPG´s exposure to the U.S. automotive market."

It´s unclear what the changes will mean for the jobs and operations in Chillicothe. Maurer said the new deal would go through in the third quarter of this year and added, "Going forward, any decisions on operations will probably be made by the new company."