Argos North America, Summit Materials map $3.2 billion merger

Sources: Argos North America, Alpharetta, Ga.; Summit Materials Inc., Denver; CP staff

Colombia-based Cementos Argos has entered a definitive agreement with Summit Materials Inc. under which Argos North America Corp. will combine with Summit in a cash and stock transaction. It calls for Cementos Argos to receive approximately $1.2 billion in cash and 54.7 million shares—or 31 percent—of Summit stock, valuing Argos North America at approximately $3.2 billion. The merger would yield a) the largest U.S.-based cement producer, besting Eagle Materials Inc. and spanning Summit Materials’ Continental plants in Iowa and Missouri plus Argos USA Alabama, Florida, South Carolina and West Virginia plants; and, b) broaden Summit Materials’ ready mixed concrete and aggregate production footprint in the Mid-Atlantic, Southeast and Texas markets. A post-merger Summit Materials would have annual revenue of $4 billion-plus and a significant presence in major urban markets spanning 30 U.S. states. 

“This agreement enables Cementos Argos to fulfill its strategic goal of generating greater economic value for shareholders,” says CEO Juan Esteban Calle. “It aligns with our objective of holding a substantial stake in a New York Stock Exchange-listed company and leverages a platform with a proven track record of growth, enabling substantial potential for future expansion and profitability. Argos will continue to contribute its business knowledge and leadership in sustainability initiatives as part of the combined organization’s Board of Directors.”

“The transaction will extend our geographic reach into high growth markets, creating a leading cement enterprise nationwide, and bring together two talent-rich organizations to innovate and deliver value-added solutions for our customers,” adds Summit Materials CEO Anne Noonan. “Financially, we have clear line of sight to achieving targeted synergies of more than $100 million annually as we unlock the full potential of this powerful combination. The Argos USA team has done an excellent job growing and operating its business, and we look forward to welcoming them, and their expertise, to the Summit family.”