RPM International Announces Resolution Of GSA Pricing Inquiry
MEDINA, Ohio, Aug. 27, 2013 /PRNewswire/ -- RPM International Inc. (NYSE: RPM) today announced that it has entered into a final agreement with the U.S. Department of Justice (DOJ) to settle claims regarding U.S. General Services Administration (GSA) Multiple Award Schedule (MAS) contracts held by the roofing division of the RPM Building Solutions Group. The company expects to pay a total of approximately $65.1 million in order to resolve the issues arising out of those contracts and other related costs. As previously reported, on April 4, 2013, RPM disclosed that it had taken an accrual of $68.8 million in anticipation of a potential settlement. Additionally, on July 22, 2013, RPM disclosed that it had reduced its estimated accrual by $3.7 million.
The settlement with the DOJ involved the Building Solutions Group's recognition that accurate information about commercial pricing and discounting practices was not always provided on a timely basis to the GSA, and that federal agencies purchasing under the GSA MAS contracts did not always receive the pricing required by the contracts. The majority of the incidents on which the settlement is based occurred between 2002 and 2008.
Frank C. Sullivan, RPM International Inc. chairman and CEO, stated, "Though our roofing division made mistakes in the administration of our GSA contracts, it has always delivered excellent roofing and weatherproofing solutions to its federal customers. The installed product performance, which was a subject of the investigation, accounted for less than 0.3% of the settlement value. We are fully committed to conducting business with the highest levels of compliance, and have taken a number of proactive actions to strengthen our administrative procedures and compliance systems to prevent future errors from occurring."
RPM International Inc., a holding company, owns subsidiaries that are world leaders in specialty coatings, sealants, building materials and related services serving both industrial and consumer markets. RPM's industrial products include roofing systems, sealants, corrosion control coatings, flooring coatings and specialty chemicals. Industrial brands include Stonhard, Tremco, illbruck, Carboline, Flowcrete, Universal Sealants and Euco. RPM's consumer products are used by professionals and do-it-yourselfers for home maintenance and improvement and by hobbyists. Consumer brands include Zinsser, Rust-Oleum, DAP, Varathane and Testors. Additional details can be found at www.RPMinc.com and by following RPM on Twitter at www.twitter.com/RPMintl.
SOURCE RPM International Inc.