Boston-based private equity fund operator Audax Group announced last month a definitive agreement to sell Raleigh, N.C.-based Ready Mixed Concrete Co.
Boston-based private equity fund operator Audax Group announced last month a definitive agreement to sell Raleigh, N.C.-based Ready Mixed Concrete Co. (RMCC) to Cemento Argos, a Medellin, Colombia-based powder operator. The deal is valued at $435 million, representing a nearly 110 percent gain from fall 2004, when Audax led a leveraged buyout for RMCC. With more than 75 plants and an estimated fleet of 600 mixer trucks, the company is a major player in North Carolina and has additional properties in South Carolina and Virginia.
The deal is the third of its kind for Argos, which entered the U.S. ready mixed business late last year by acquiring Southern Star Concrete Co., a key player in Dallas and Houston, and Concrete Express, a small operator in Savannah, Ga. The $245 million Southern Star deal represented a more-than-threefold gain for Austin-based private equity fund manager Texas Growth.
Ironically, Southern Star and RMCC appear to include ready mixed operations that were once under Dallas-based giant Gifford Hill. RMCC brings Argos additional assets in markets where Mexico’s Cemex S.A. is a key ready mixed player. Like Southern Star, Cemex is a long-time operator in Houston and gained a significant Carolinas foothold through its March 2005 RMC Group acquisition.
Although Southern Star and RMCC entailed separate private equity sellers, the transactions have common threads beyond Argos. A Charlotte, N.C., firm, McColl Partners LLC, served as a financial advisor to Texas Growth on the Southern Star sale, and to Ready Mixed Concrete’s principals Û the Turner family Û in the sale to Audax. Atlanta-based counsel Kilpatrick Stockton LLP advised Argos on the Southern Star acquisition and was also involved in the RMCC-Audax deal.
The RMCC agreement did not signal Audax’s exit from concrete. In the week prior to the agreement, Audax announced closing on a deal for Silver State Materials LLC, which has four ready mixed plants and a 100-truck fleet serving Las Vegas-anchored Clark County, Nev., and two aggregate operations in nearby Boulder City. Terms of the deal were not disclosed, although Audax indicated that Silver State’s Steve Hill would remain chief executive officer. Silver State was founded in 1987 by members of Ohio’s Spurlino family, originally running a portable plant, then establishing fixed locations.