Sources: Cemex S.A.B. de C.V., Monterrey, Mexico; CP staff
Cemex is on track to unload in early 2017 a major non-core U.S. asset: the Rinker Materials concrete pipe and precast business. Under a definitive agreement announced November 28, the producer will sell the entity to Atlanta-based Quikrete Holdings Inc. for about $500 million, plus an additional $40 million depending on future performance.
Rinker Materials has upwards of 30 pipe and precast plants in 20 states. It would propel Quikrete Holdings to leadership in the concrete drainage products market, and complement assets the company is gaining through the acquisition of Ohio-based Contech Engineered Solutions.
Cemex will use proceeds from the sale to reduce debt, which has remained at elevated levels since the company’s 2007 Rinker Group acquisition. Beyond a major stake in U.S. concrete pipe and precast, that deal greatly strengthened Cemex USA in core ready mixed concrete, cement and aggregates businesses. The Rinker Materials sale follows two other nine-figure transactions Cemex has effected this year with an eye to debt reduction and a streamlined U.S. portfolio.