Volume 9, Issue 1 - January 2008
Volume 9, Issue 1 - January 2008
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GLOBAL
news The European Commission (EC) announced its decision to fine four glass manufacturing companies a total of EUR 486.9 million (approximately USD $719.2 million) for price-fixing on November 27. According to a statement issued by Neelie Kroes, the European Commissioner for Competition Policy, at a press conference held in Brussels the following day, Japan-based Asahi Glass Co.’s subsidiary AGC Flat Glass Europe in Belgium has been fined $96 million; Auburn Hills, Mich.-based Guardian Industries will be fined $218.6 million; Pilkington, a member of NSG Group headquartered in the United Kingdom, is to be fined $206.8 million; and Saint-Gobain in France is to be fined $197.7 million. “The Commission has established that in 2004 and 2005 representatives of these companies met covertly at hotels and restaurants around Europe. At these meetings they conspired to increase prices for flat glass, discussing both the amount and the timing of price increases,” Kroes said in his statement. “The companies profited from selling flat glass at artificially inflated prices.” AGC was aware of the decision prior to the announcement. “The European Commission conducted onsite inspections at the premises of AGC Flat Glass Europe on February 22 and 23, 2005, and issued a Statement of Objections to AGC Flat Glass Europe and Asahi Glass early March, 2007. Both companies have cooperated with the Commission during the investigation,” said the statement released by the company. The announcement was not a surprise to Sophie Chevallon, exterior communications director of Saint Gobain, either. “We knew that we would have a fine,” she says. “We recognize the facts in the case.” According to Kroes, “The fine is based on a variety of factors set out in the Commission’s 2006 Notice on Fines. The factors include the turnover of the companies on the affected market, as well as the duration and gravity of the infringements.” Guardian received the highest of the fines issued. Walters explains that the EC does a “complex mathematical analysis” to determine the amounts of the fines. “We’re the smallest of the companies in Europe, but we’re the largest supplier of independent customers,” he says. Walters says he expects that is the reason the calculation ended up the way it did. According to the statement from the EC, Asahi’s fine was most lenient due to “substantial cooperation under the Leniency Notice.” Since the price-fixing fines were announced, one glass shop owner, John Draper of Draper’s Auto Glass in San Bernardino, Calif., has filed a class-action suit alleging price-fixing against Guardian Industries, Pilkington Plc, Saint Gobain Glass Corp. and Asahi Glass Co. and all their subsidiaries in U.S. District Court in the Eastern District of Pennsylvania. In the suit, filed on December 12 under the Sherman Antitrust Act of 1890 and the Clayton Antitrust Act of 1914, Draper alleges that the companies’ alleged agreement to fix prices deprived it and others similarly situated “of the benefits of free, open and unrestricted competition in the market.” Draper, who is represented by Chimicles & Tikellis LLP, Labtaon Sucharow LLP and Glancy Binkow & Goldberg LLP, also alleges that the defendants’ actions “unlawfully restrained, suppressed and eliminated” competition in establishing prices paid in the United States and worldwide for glass (both flat and automotive). Finally, the plaintiff alleges that prices charged to it and other retailers were fixed at “higher, artificially derived, non-competitive levels.” COMPANY NEWS “Truth is excited about the opportunities that ISC brings to our team,” says Steve Groves, Truth’s senior vice president of sales and marketing. “With more ‘feet on the street,’ Truth’s presence will become broader and allow us to be more responsive throughout the industry.” With the addition of ISC, Truth will now have 29 team members in its sales force. Jim Hornung, president of ISC, also notes the partner is beneficial to it also, due to the extension in products it will now be able to offer. Court Confirms Solutia Plan of Reorganization “While this has been a long process, we have used our time in Chapter 11 to truly transform and revitalize Solutia—shaping a strong portfolio of businesses, shedding $1.3 billion in liabilities and growing the company by $1 billion in sales while more than doubling our earnings. We will emerge from Chapter 11 as a growing, vibrant company that is positioned for success,” says Jeffry N. Quinn, chairman, president and chief executive officer for Solutia Inc. At press time, the company anticipated the plan of reorganization to become effective in January. PPG Completes Acquisition of Sigma Kalon Group “This acquisition is strongly aligned with our vision and core strategies,” says Charles E. Bunch, chairman and chief executive officer of PPG. “With SigmaKalon, we are accelerating our transformation to focus on coatings and specialty products.” Bunch notes that almost three quarters of the company’s sales from continuing operations will now come from coatings, and more than 80 percent will come from its coatings, optical and specialty products businesses. “SigmaKalon is a very complementary fit for us,” Bunch adds. “The acquisition will greatly expand our geographic footprint, extend our market presence in various end-use markets, and sharply increase the proportion of sales coming from architectural or decorative coatings.” Casement Ltd. and VAP Global Enter Agreement VAP Global Industries is based in Vancouver, British Columbia. CMI Forms Partnership with Yawei and TaFu in China CMI says this move expands its manufacturing network and is aimed at helping the company grow its international molded interior door business, particularly in Asia, India and the Middle East, while also positioning it for the domestic new construction market recovery. CraftMaster Asia, a wholly owned subsidiary of CMI, will manage the partnership with Fudun. Terms of the transaction were not disclosed. LEGISLATION “We routinely collect industry feedback when someone (typically an employer—in this case, an association and/or an apprenticeship field rep) wants to have an occupation recognized nationally as officially ‘apprenticeable,’ as per U.S. Department of Labor protocols,” explains Kenneth Lemberg with the DOL. “We want to make sure that the proposed training and development program accurately reflects industry demand for a skilled workforce.” According to information from Lemberg, an apprenticeable occupation possesses all the following characteristics as stated in Title 29 CFR Part 29.4, Criteria for Apprenticeable Occupations:
Lemberg says that if DOL decides that this occupation is apprenticeable, seeking or offering an apprenticeship would be entirely voluntary. CORRECTION WEBINARS The topics covered in the presentation included an overview of the door and window industry, including transactions, expansions and plant closings. Also included was a discussion of current industry trends, the state of the residential and commercial real estate markets, industry growth drivers, strategies companies are using in the current environment and a review of the capital markets. The final section of the presentation covered an update of the firm’s ongoing research into the competitive threat posed by Chinese window and door companies, including recent import statistics. www.jordanknauff.com/webinar-request FINANCIAL NEWS The company’s building products division reported fourth-quarter net sales of $260.0 million and an operating income of $31.6 million. www.quanex.com ASSOCIATION NEWS “In addition to various editorial changes, Section 1.8, Program Oversight, now requires that the AAMA Certification Policy Committee specify dates of implementation for all revisions to program policy; that representatives of record for the appropriate program or program function, along with the AAMA Voting Representative (if applicable), be notified within 10 business days; and that Licensee conformance be verified during plant and lab inspections,” says Dean Lewis, AAMA certification manager. Section 2.0, Engineering Design Rules, was removed and now cites the newly created AAMA 2502, Comparative Analysis Procedure for Window and Door Products, as guidance. Section 4.0, Guide for Laboratories Approved for the AAMA Certification Program, also was removed and the requirements of AAMA LAP-1, Laboratory Accreditation Program Operations Manual are now required. The Auxiliary Test Procedures, Section 5.0, was removed and indicates to “refer directly to the auxiliary test requirements for the specific product as required by the edition of AAMA/(NWWDA)WDMA 101/I.S. 2 or AAMA/WDMA/CSA 101/I.S. 2/A440 to which the product is to be tested for certification.” www.aamanet.org KUDOS Tru-Defense is designed to work together to protect homes from severe weather, according to the company. Therma-Tru’s Tru-Defense certified entry and patio doors have an air, water and structural performance rating of DP-40 or higher, according to the company, and the complete door systems are independently tested, and certified by the National Accreditation and Management Institute (NAMI).
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