PPG finalizes sale of Transitions Optical for $1.73 billion

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For years, PPG Industries touted its Transitions Optical venture as one of the company’s successful growth engines as it shifted its portfolio away from traditional products, including automobile glass and chemicals, and narrowed its focus on industrial and residential paints.

But when Downtown-based PPG last year decided to sell its 51 percent stake in Transitions to its joint venture partner, Essilor International of France, it said Transitions would fare better under an owner devoted to the eyecare business.

Essilor, which had sales of 5 billion euros ($6.9 billion) in 2013, makes consumer eye lens brands such as Foster Grant and Varilux. It also makes equipment for eye-care professionals.

Essilor teamed with PPG in 1990 to create Transitions. The attraction for Essilor was the PPG technology that allows lenses to tint darker when exposed to light.

On Tuesday, PPG said it completed the $1.73 billion cash deal, which will total about $1.5 billion in cash after taxes. The sale also includes PPG’s sun lens business, Intercast, based in Parma, Italy.

Besides the $1.73 billion it will pay at closing, Essilor said the deal includes a deferred payment of $125 million over five years.

Transitions, headquartered in Pinellas Park, Fla., near Tampa, generated sales of $874 million in 2013 and employs about 1,800 worldwide.

From its launch as a 50-person startup, Transitions’ business swelled to 20 percent of all eyeglass lenses sold in the U.S., according to PPG.

PPG, which had global sales of $15.1 billion last year, has said it will use the cash from the Transitions sale to finance future acquisitions.

In executive moves announced following news of the sale, PPG said Rick Elias, senior vice president, optical and specialty materials for PPG and chief executive of Transitions, retired effective Tuesday.

Dave Cole, formerly president of Transitions, has been named vice president, packaging coatings, for PPG and will be based in Pittsburgh. Anup Jain has been named vice president, specialty coatings and materials. He was formerly vice president, silica products and will continue to oversee the silica products business.

PPG’s technical center in Monroeville will continue to provide research and development services for Transitions, the company said.

Shares in PPG closed Tuesday at $196.64, up $3.18.

Joyce Gannon: jgannon@post-gazette.com or 412-263-1580. First Published April 1, 2014 9:42 AM

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