Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Ppg's Latest Challenge Activist Investor Could Try to Shake Up the Coatings Giant

Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Ppg's Latest Challenge Activist Investor Could Try to Shake Up the Coatings Giant

Article excerpt

The June morning when he went to work with a paint roller at the Carnegie Science Center on the North Shore may have been a high point in an otherwise stressful year for Michael McGarry, chairman and chief executive of PPG.

That day, wearing a business suit and tie and without splattering a drop, he helped put the final strokes of white paint on the PPG Science Pavilion, a $33 million addition to the museum for which PPG contributed $7.5 million.

After a hurried tour of the new space overlooking the Allegheny River, Mr. McGarry was back to running the $14 billion global coatings maker that has faced a series of unexpected challenges this year.

In February, home improvement chain Lowe's said it was dropping PPG's Olympic brand paints and stains after striking an exclusive supplier deal with PPG rival Sherwin-Williams.

In April, PPG disclosed an internal accounting scandal that resulted in a probe by the Securities and Exchange Commission, and eventually led to firing its controller and restating earnings for the first quarter of this year and all of 2017 and 2016.

Last week, the stock plunged 10 percent in one day after PPG warned that third-quarter earnings would miss projections because of higher costs and sluggish demand.

That same day, activist investor Nelson Peltz's Trian Fund Management disclosed it has taken a nearly 3 percent stake in the company.

Trian, known for investing in companies it believes need a push to perform better for shareholders, did not specify any plans or recommendations for PPG in an SEC filing.

But its presence could result in a board seat or recommendations for PPG management to shake up the Pittsburgh company's strategy.

Founded in 2005, Trian's portfolio includes past and current investments in a number of high-profile brands including Cadbury, Domino's, Dr Pepper Snapple, Pepsico, Wendy's and Tiffany & Co. …

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