Sources: CP staff; Vulcan Materials Co., Birmingham, Ala.; U.S. Department of Justice
Vulcan Materials closed its planned $900 million acquisition of 36-site Aggregates USA on the final business day of 2017, along with a companion $290 million transaction through investor Blue Water Industries. The latter involves the sale of 17 Tennessee and Virginia quarries and yards, and abides a Department of Justice Antitrust Division settlement addressing coarse-aggregate production overlap between Vulcan and Aggregates USA in southwest Virginia, plus the Knoxville and Tri-Cities, Tenn., markets. Vulcan will assimilate the remainder of the portfolio—three Georgia quarries and 16 rail distribution yards in Georgia, Florida and South Carolina—into its Southeast platform.
The top two U.S. aggregate producers are pacing each other in building annual production volumes and long-term limestone and granite reserves. Predictable in most any economic cycle, their strategy takes on new dimensions in 2017, as investors see U.S. crushed stone and sand & gravel shipments netting some of the best returns or future earnings prospects in heavy building materials.
Sources: Vulcan Materials Co., Birmingham, Ala.; CP staff
Vulcan Materials has reached a definitive agreement with Mill Valley, Calif., investor SPO Partners to acquire Aggregates USA LLC for $900 million. The cash deal is the second nine-figure transaction this year involving rock production and distribution assets, following CRH/Oldcastle Materials’ planned takeover of Indiana-based Mulzer Crushed Stone, announced in March.