Houston-based U.S. Concrete Inc. and Detroit’s Edw. C. Levy Co. announced late last month plans for a joint venture that will become the largest ready
Houston-based U.S. Concrete Inc. and Detroit’s Edw. C. Levy Co. announced late last month plans for a joint venture that will become the largest ready mixed producer in Michigan, where a declining, auto industry-dependent economy invites market rationalization.
With a projected early-April closing, the transaction calls for U.S. Concrete and Levy Co. to contribute their Michigan ready-mixed concrete and related concrete products assets in exchange for 60 percent and 40 percent stakes, respectively. The entity spans metro Detroit businesses that reported 2006 revenues upward of $110 million, and will operate under Superior Materials, a brand U.S. Concrete has developed through a handful of acquisitions beginning in 2000. The joint venture will include a fleet of about 300 mixers; 28 plants with annual output around 1.4 million-yd.; and, a 24,000-ton cement terminal. Superior Materials will have a long-term supply agreement with Levy Co., one of Michigan’s largest sand & gravel producers.
For over 40 years, the Edw. C. Levy Co., as Clawson Concrete and Killins Concrete, has provided quality ready-mix products and services to our customers in southeast Michigan, says Levy Co. Chief Operating Officer S. Evan Weiner. Our people have delivered outstanding results for the most important building and infrastructure landmarks in our community. Both companies bring significant high quality assets and talented personnel to the joint venture, and we expect great things in the future.
Adds U.S. Concrete COO and Executive Vice President Michael Harlan, We expect the combined operations will lead to better leveraging of assets [and] stronger financial results in a challenging operating environment. Integration of the combined operations is expected to occur over the next several months and result in substantial synergies, including operational efficiencies. The Edw. C. Levy Co. is one of the most respected companies in Michigan, and we are proud to be working with them.
The joint venture complements our strategies of achieving a leading ready-mixed supplier position in our markets, while securing a long-term commitment for cost-effective aggregates supply and furthering in-market vertical integration through access to a cement terminal.