Royal Group: US PVC maker to buy Royal Group

PVC maker Georgia Gulf is to buy leading window profile manufacturer Royal Group of Toronto for a total of US$1.7bn. The companies reached agreement on the deal late last week, citing benefits from the vertical integration of the Atlanta-based resin maker with the downstream PVC user. The price for the take-over represents a premium of 43% over the price at which Royal group’s shares were trading prior to the Georgia Gulf move. With annual sales of around US$1.5bn., Royal Group tops the rankings of PVC window profile makers. The company has been up for sale for more than one year and local analysts had wondered whether a buyer would emerge for the Canadian firm, subject of regulatory probes into its practices. “We believe that the combination of Georgia Gulf and Royal Group will result in a formidable force in the vinyl products industry,” said Royal president and chief executive Lawrence Blanford. Georgia Gulf has a good track record of successfully integrating businesses, according to Ed Schmitt, chairman, president and chief executive.

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