Steady, but modest, growth is the trend

AggMan Staff | Published on November 1, 2012

By George H. Reddin

 

Slow progress in the return of the residential market, modest enthusiasm for the passage of MAP-21, and the continued steady, albeit modest, pace of acquisitions are starting to give some optimism that the worst is behind us and that the future, most likely beyond 2013, is looking brighter.

 

Recent transactions

Alco Corp., a producer of asphalt roofing materials headquartered in Canovanas, Puerto Rico, has sold asphalt plants to BTB Corp. and Pro-Pave Corp. BTB Corp., headquartered in Penuelas, Puerto Rico, engages in the distribution and marketing of liquid asphalt and emulsion. Pro-Pave is headquartered in San Juan, Puerto Rico, and is a highway and paving contractor.

STOCK REPORT — Sources: New York Stock Exchange, NASDAQ, and Wall Street Journal Market Watch. Currency conversion calculated on 10/4/2012.

U.S. Concrete, Inc., through its wholly owned subsidiary, Ingram Concrete, LLC, has acquired the ready-mix operations of Colorado River Concrete, LP; Cindy & Robin Concrete, LP; and E&R Artecona FLP for $2.4 million in cash, and the assumption of approximately $1.9 million in debt. The acquisition includes four ready-mix concrete plants located in Stephenville, Aledo, Glen Rose, and Granbury, Texas.

Eagle Materials Inc. has entered into a definitive agreement with Lafarge North America to purchase Lafarge’s Sugar Creek, Mo., and Tulsa, Okla., cement plants, as well as related assets, which include six distribution terminals, two aggregates quarries, eight ready-mix concrete plants, and a fly-ash business. Eagle will also enter into a transition sales agreement to supply certain Lafarge operations with cement for four to five years and an agreement with a Lafarge affiliate to supply low-cost alternative fuels to the acquired operations.

U.S. On-Highway Diesel Fuel Prices
Source: U.S. Energy Information Administration (dollars per gallon, prices include all taxes).

Borrowings under Eagle’s existing bank credit facility and a new equity offering will fund the $446 million purchase price. Trailing 12-month revenues through June 30, 2012, for the cement plants and related assets, were $178 million.

 

Other news

Martin Marietta Materials, Inc. is free to resume its fight for Vulcan Materials Co. Martin Marietta’s efforts were placed on a four-month, court-imposed hold in May, which effectively lengthened the time it would take for it to take control of the Vulcan board by two years, given the time frame of when a proxy can be voted on at this point. So far, the company has kept silent. 

George H. Reddin is a principal in FMI’s Investment Banking practice. He can be reached at 919-785-9286 or at greddin@fminet.com.

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