Investors, market conditions validate TXI expansion, integration strategy

Sources: Texas Industries Inc., Dallas; CP staff

Stock price gains and plant capacity ramp up suggest that a bellwether operator will reap returns from escalating ready mixed, cement and aggregate demand in one of the industry’s strongest markets.

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TXI ups concrete capacity nearly 50 percent in Transit Mix deal

Sources: Texas Industries Inc., Trinity Industries Inc.; CP staff

An agreement between two of Texas’ biggest ready mixed concrete operators befits the Lone Star State in scope and strategy: TXI is shedding lightweight aggregate plants in Texas, Colorado and California for 42 ready mixed production and two aggregate distribution sites spanning east Texas and parts of Arkansas, all under Trinity subsidiary Transit Mix Concrete & Materials. The deal positions TXI with 106 ready mixed plants, approximately 3.5 million yards’ production (2012 estimate), and a fleet of 500-plus mixers.

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Cemex asset swap helps TXI expand R-M, aggregates presence in central Texas

Sources: Texas Industries, Inc., Dallas; Cemex USA, Houston; CP staff

TXI announced that its subsidiary has entered into an asset swap with Cemex USA, in which TXI will acquire the ready mix and aggregate operations of Cemex that serve the Austin metropolitan market. The transaction was finalized July 29 and brings TXI one aggregate and three ready mixed concrete plants. “While times remain challenging, we will continue to investigate opportunities that enhance the company’s long-term strategic position,” said TXI CEO Mel Brekhus.

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Top two TXI shareholders’ stake surpasses 40 percent

Sources: Securities & Exchange Commission; CP staff

A series of late-June trades has positioned Memphis-based Southeast Asset Management Inc. and its Longleaf Partners Small-Cap Fund with nearly 5.8 million of Texas Industries’ approximately 27.9 million outstanding shares of common stock. The trades were completed at just under $40/share—versus a July 5 closing price of $41.90—and consolidate a Southeast Asset/Longleaf TXI stake of about 20.7 percent. Citing interest in “undervalued companies,” Longleaf Partners effected its first major TXI trade, equating to a 12.7 percent stake, in fall 2006.

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23-plant Transit Mix deal improves TXI’s central Texas integration

Sources: Texas Industries Inc., Dallas; CP staff

An early-April transaction has yielded TXI ready mixed operations strategic to its Hunters Cement mill in New Braunfels, where a $350 million-plus capacity expansion nears completion. TXI acquired 23 concrete plants, running north of San Antonio through Hillsdale, Texas, from Transit Mix Concrete and Materials, a subsidiary of Dallas peer Trinity Industries. The deal also saw transfer of TXI’s Anacoco, Paradise and Beckett sand & gravel sites—serving markets in east and north Texas, plus Louisiana, some with Transit Mix concrete plants—to Trinity Materials Inc.

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