Swedlow Holders Approve Sale Despite Lawsuit

Shareholders of Swedlow Inc. in Garden Grove approved an agreement Thursday for the $42-million sale of the company to PPG Industries Inc. of Pittsburgh, even though the Federal Trade Commission has filed a lawsuit to halt the transaction as anti-competitive. The suit is to be heard Jan. 30.

Seventy-four percent of Swedlow’s 1,239,920 total shares outstanding were voted in favor of the acquisition, said Gloria Shimer, a director. PPG had 49% of the vote pledged to it by proxy. Only 962 votes were cast against the merger, and 95 shares abstained. Remaining votes are in street names--owned by brokerage houses or their customers--and have not been turned in, she said.

Under the terms of the buy-out offer, PPG will pay $32.60 a share for all outstanding shares plus about 50,000 shares held for employee stock options. Because of the FTC suit, PPG and Swedlow have extended the date after which either party may terminate the agreement. That date was not revealed by Swedlow.

The lawsuit, filed against PPG on Monday in the U.S. District Court in Washington, D.C., seeks to halt the merger until the agency determines whether the acquisition by PPG “substantially lessens” competition for aircraft window, windshield and canopy parts. Swedlow, which makes plastic canopies for military aircraft, now supplies about 30% of the worldwide market, while a PPG division that makes glass windows for commercial jets supplies about 40% of the market.