December 6 (SeeNews) - French building materials group Saint-Gobain said on Tuesday it has acquired Romanian company Pietta Glass Working for an undisclosed sum.
The Romanian company is active in glass processing and production of insulating glazing systems for facade markets and industrial applications
You can subscribe to our M&A newsletter here
"The flat glass business is already established in Romania with a float glass plant and a coater. This acquisition will allow the Group to expand the business' industrial footprint in order to better serve the growing facade markets and round out its positioning in industrial applications with an optimized cost base," Saint Gobain said in a press release.
"The transaction is consistent with the Group's strategy of expanding its range of downstream products towards high value-added solutions," it added.
According to the French group, Pietta Glass' sales should reach 20 million euro ($21.2 million) in 2016 and the Romanian company has a strong potential for growth over the next few years.
Pietta Glass Working was established in 2000, in Prahova county, southern Romania. It operates four plants which employ some 450 people and spread over an area of over 45,000 square meters.
Pietta processes monolithic glass for domestic appliance and automotive glass in one of its plant and architectural glass, furniture glass and shipbuilding glass in the second. In the third plant products for refrigeration cabinets are assembled, while in the fourth plant Pietta manufactures cells for building facades.
At the beginning of the year, Saint Gobain suspended fiberglass mineral wool production at its factory in Ploiesti, in southern Romania, due to overcapacity. The production was halted for an indefinite period of time and has not yet been resumed.
The decision to suspend production was prompted by the economic crisis in the construction sector and a continuous decline in sales and profitability reflecting fiberglass mineral wool production overcapacity in Central and Eastern Europe.
The plant in Ploiesti county is operated by Saint-Gobain Construction Products Romania through its Isover unit.
The second production line at the Ploiesti plant, for mineral wool, continued to operate. The line is serviced by 86 employees.
Saint Gobain Group operates in 66 countries and has over 170,000 employees. In Romania, the company has some 800 employees working in 10 production sites located in Brasov, Branesti, Calarasi, Ploiesti, Satu-Mare, Tulcea, Turda and Suceava.
Saint Gobain Glass Romania turned to a 5.39 million lei ($1.27 million/1.19 million euro) profit from a 15.7 million lei loss in 2014 on sales of 339.6 million lei up 9% from the previous year, according to data posted on the website of the finance ministry.
(1 euro=4.5027 Romanian lei)