Vulcan to acquire Aggregates USA
Agreement reached with SPO Partners for US$900 million acquisition of south-eastern US aggregates business
VULCAN Materials Company, the largest producers of construction aggregates in the US, have reached a definitive agreement with SPO Partners, a Californian-based investment partnership, to acquire their aggregates business, Aggregates USA LLC, for US$900 million in cash.
Aggregates USA operate 31 facilities serving high-growth markets in Georgia, Florida, Tennessee, South Carolina and Virginia.
‘We are pleased to have reached agreement with SPO Partners for these strategic assets, which will enhance our ability to serve high-growth markets throughout the south-eastern US,’ said Vulcan’s chairman and chief executive officer, Tom Hill.
‘With the addition of these quarries and related assets, Vulcan will be able to capitalize on continuing increases in state highway funding programmes in Georgia, Florida, South Carolina, Tennessee, and Virginia, and on the continued private sector growth across the region.
‘This transaction will provide Vulcan with long-term high-quality reserves across the entire portfolio. Aggregates USA operate efficient, high-productivity facilities run by strong teams, and we welcome them to our company.’
The acquisition will complement and expand Vulcan’s service offerings in Georgia with three granite quarries – two of which have rail capabilities that will extend the company’s reach into important markets – along with 16 rail distribution yards in Georgia, South Carolina and Florida. In addition, the acquisition includes 12 limestone quarries in eastern Tennessee and south-west Virginia.
Vulcan expect the transaction, which is subject to customary closing conditions and regulatory conditions, to be accretive to the company’s earnings per share in the first year following the close. The company says it may divest several quarries in Tennessee to a third party in order to expedite the regulatory approval process.