January 7, 2012
Mergers and acquisitions move at a snail’s pace
Merger and acquisition activity continued to plug along at a snail’s pace as 2011 closed. For the year, merger and acquisition activity resembled overall movement in the construction materials sector — slow and disappointing. With producers anticipating more of the same or even further declines in 2012, buyers remain on the sidelines waiting for more uncertainty to be removed from the equation.
Recent merger and acquisition activity continues to highlight strategic, bolt-on, acquisitions and corporate divestitures. Oldcastle Materials, Inc. and Summit Materials continue to set the pace of small- to medium-sized strategic acquisitions as they pursue consolidation strategies in existing markets. Cemex and Lafarge continue to lead the way in corporate divestitures as they seek to reduce debt and improve liquidity.
Oldcastle Materials, Inc. has acquired the assets of Powers Stone, Inc. in Susquehanna County, Pa. The company consists of three aggregate quarries. The operations will join Oldcastle Materials’ Mid-Atlantic Division under Pennsy Supply. Powers Stone, Inc. enhances Oldcastle’s ability to better service the growing demand for aggregate, asphalt, and contracting services in the heart of the Marcellus Shale gas market.
Summit Materials has acquired Industrial Asphalt, Inc., Asphalt Paving Co. of Austin, Inc., and Ramming Paving Co., Ltd. in Austin, Texas. Industrial Asphalt, Inc. is based in south Austin and operates a quarry and two asphalt plants. Asphalt Paving is also based in Austin and is a longstanding paving business. Ramming Paving Co. is a quarry, asphalt, and paving services company with operations in Austin and San Antonio.
Cemex has sold its Russell Roof Tiles business to Russell Building Products, backed by investors from Mexico. Cemex announced this year it was seeking to dispose of all non-core assets, such as Russell Roof Tiles, in order to pay down debt.