Trian Partners Activist Presentation Deck
Losing the Lowe's Business Appears to Be a Sign of Poor Execution
▪ On February 27, 2018, Lowe's informed PPG that it will discontinue the
sale of Olympic brand paints and stains in its US retail stores, effective
mid-2018 (~$300m of lost sales)
▪ The sudden loss of the Lowe's business, one of the Company's largest
architectural customers, casts a shadow on this management team's
basic execution skills
▪ While PPG reported it may acquire some incremental business at Home
Depot to mitigate the loss of the Lowe's business, we are concerned that
the Company had to forego margin in a rushed negotiation
"The loss of PPG's entire paint business at Lowe's (to Sherwin-Williams) was a
surprise. We had actually thought PPG might gain a price point at Lowe's following
the merger of Valspar and Sherwin, Lowe's 2 other paint suppliers, and Lowe's
history of having at least 2 reasonably strong paint suppliers (3 in recent years) in
order to maintain the competitive intensity amongst its suppliers.
- Deutsch Bank research, 2/28/18
Source: Wall Street research, press releases.
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