Current Price – PPG $133.13, GGC $40.67
Offer Price – $1.11 stock of GGC for $1.00 stock of PPG
Upside – 11% or $1450 for Odd Lot holders
Expiration date – January 25, 2013
Odd Lot holders (less than 100 shares) are not subject to proration
Buy 99 PPG and sell short 360 GGC. Lock in gain of $460. Tender PPG for GGC. Cover short position after receiving the exchange shares.
PPG shareholders have the option to exchange all, some or none of their shares of PPG common stock for shares of Eagle Spinco common stock, subject to proration as described below. Shares of Eagle Spinco common stock will convert automatically into the right to receive shares of Georgia Gulf common stock at the closing of the merger of a Georgia Gulf subsidiary with and into Eagle Spinco, which is expected to occur promptly after completion of the exchange offer.
Tendering PPG shareholders are expected to receive approximately $1.11 of Georgia Gulf common stock for every $1.00 of PPG common stock tendered, subject to the upper limit described below. The number of shares you can receive is, however, subject to an upper limit of 3.9745 shares of Splitco common stock for each share of PPG common stock accepted in this exchange offer.
PPG will determine the prices at which shares of PPG common stock and shares of Eagle Spinco common stock (and ultimately Georgia Gulf common stock) will be exchanged by reference to the simple arithmetic average of the daily volume-weighted average prices of PPG common stock and Georgia Gulf common stock, respectively, on the New York Stock Exchange on each of the last three trading days of the exchange offer.
PPG currently expects to issue approximately 35,236,010 shares of Eagle Spinco common stock in the exchange offer.
The final exchange ratio is expected to be calculated using the volume weighted average stock prices (“VWAP”) of PPG and Georgia Gulf on January 23, 2013, January 24, 2013 and January 25, 2013, and is expected to be announced by 4:30 pm ET on January 25, 2013.
No proration for Odd Lot holders:
Beneficial holders (other than plan participants in the PPG Employee Savings Plan or PPG Defined Contribution Retirement Plan) of less than 100 shares of PPG common stock who validly tender all of their shares may elect not to be subject to proration by completing the box in the applicable letter of transmittal entitled “Odd-Lot Shares.”
Source of Funds:
Not applicable as exchange transaction.