For 30 years, multinational construction materials producers have been picking up concrete operators in key U.S. markets, but it took a long time for
DON MARSH, EDITOR
For 30 years, multinational construction materials producers have been picking up concrete operators in key U.S. markets, but it took a long time for them to stake claim to the third largest. Following the entry of Hanson Aggregates and Aggregate Industries, Brazil’s Votorantim Cementos closed on an asset deal in late-January for Chicago fixture Prairie Material Sales Inc. Effected through Toronto-based Votorantim Cement North America (VCNA), the buyout removes the Windy City from a shrinking list of major U.S. urban centers where a multinational does not hold a significant concrete presence.
Based in Chicago-bordering Bridgeview, Ill., Prairie Material spans 81 ready mixed concrete plants (Illinois, Indiana, Michigan, Wisconsin), 17 aggregate operations (Illinois, Indiana), and related hauling assets; collectively, they reported sales of about $450 million in 2007 and have a payroll upwards of 1,800. The concrete plants are strategic to VCNA’s flagship business, St. Marys Cement, Toronto. Through six cement mills and grinding operations in Ontario, Michigan, Wisconsin and Illinois, St. Marys feeds 12 Great Lakes terminals serving markets anchored by Milwaukee, Chicago, Detroit, Cleveland, and Buffalo, N.Y.
Chicago market-leading Prairie Material will maintain its identity, as will satellite businesses in Wisconsin, Indiana and Michigan. VCNA has retained the management team, including Will Glusac, who was appointed president in late-2006 after serving in the same capacity with the Rinker/Florida Materials Division. Terms of the transaction were not disclosed and do not include Prairie Group’s other principal business, Illinois Brick Co. A key masonry dealer with 12 northern and central Illinois yards and showrooms, including a headquarters in the Chicago suburb of Palos Heights, it remains under Oremus family members, Prairie Group principals.
VCNA officials view their latest acquisition as an important component in expanding and further integrating a Great Lakes-region business platform. By Concrete Products’ estimates, the Prairie properties position the buyer as a top 10 U.S. ready mixed producer, with annual output approaching 7 million yd. That volume includes Prairie shipments, plus those of another recent VCNA target, Prestige Group (Florida, the Carolinas, California), and Jacksonville, Fla.-based Trinity Materials. VCNA is a partner in the latter company and Suwannee American Cement with Jacksonville road-builder Anderson Columbia.
VCNA is part of Sao Paulo-based Votorantim Cementos, operating within one of Brazil’s largest industrial conglomerates, Votorantim Group. A major construction materials player on its home turf, Votorantim Cementos gained a northern foothold in 2001 through Blue Circle Canada cement, ready mixed, aggregate and concrete products businesses. Lafarge Group shed those properties under regulatory terms covering its acquisition of Blue Circle Industries. VCNA resurrected the St. Marys Cement and Canada Building Materials brands, as well as extended its Great Lakes presence in 2005 by acquiring from Cemex USA two cement mills and related assets. Concurrently, VCNA joined Anderson Columbia as a partner in the Suwannee America plant, opened in 2003, and downstream businesses.
Although not in the global league with Cemex, CRH, HeidelbergCement, Holcim Ltd. or Lafarge Group, Votorantim Cementos has emerged this decade as an ambitious suitor for North American targets in a range of climates and markets.
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