Martin Marietta Materials in talks to buy Texas Industries
25 Jan 2014
Martin Marietta Materials Inc, the second-largest producer of construction aggregates in the United States, supplying crushed stone, sand and gravel, is in advanced talks to buy construction material supplier Texas Industries Inc, Bloomberg yesterday reported, citing people familiar with the matter.
An all-stock deal could be announced as early as next week, the report said.
Bloomberg reported last month that Dallas-based Texas Industries had put itself up for sale and was working with Citigroup to find a buyer.
With a market cap of more than $2 billion, Texas Industries is a leading supplier of cement, aggregate and consumer product building materials in Texas and California, the two largest cement markets in the US.
Texas Industries is currently more than doubling the existing production capacity at its Central Texas cement plant. With the recently completed expansion and modernization of the California cement plant, TXI is now a low-cost producer in southern California and a much larger producer of cement in the market.
It has increased its cement production capacity to 6 million tons annually and is planning to increase it to almost 8 million tons over the next several years.
The company's two largest shareholders hold more than 51-per cent stake. Investment firm Southeastern Asset Management, which last year had backed Carl Icahn in opposing the Michael Dell-led buyout of the PC maker, holds around 28 per cent , while NNS Holding, an investment vehicle for Egyptian billionaire Nassef Sawiris, holds 23 per cent.
Martin Marietta, which has a market value of about $4.8 billion and annual sales of $1.8 billion, is the US second largest producer of construction aggregates used primarily for construction of highways and other infrastructure projects.
It has network of approximately 300 quarries, distribution yards and plants spans coast to coast through 28 states, Canada, the Bahamas and the Caribbean Islands.
Through its Specialty Products business, it also produces magnesia-based chemicals used in industrial, agricultural and environmental application and dolomitic lime sold primarily to the steel industry.
