Texas industries acquired by Martin Marietta, makes construction supplies giant
by The Canadian Press
The combined company will have more than 400 quarries, mines, distribution yards, and plants in 36 states, Canada, the Bahamas and the Caribbean Islands
NEW YORK—Martin Marietta Materials is buying Texas Industries in an all-stock deal worth $2.06 billion, creating a leading supplier of aggregates and heavy building materials with a strong presence in large, fast-growing markets like California and Texas.
Martin Marietta said shareholders of Texas Industries will get 0.7 shares of Martin Marietta for each share held. Based on Monday’s closing price, that amounts to $71.95 per share.
Shares of Texas Industries picked up $3.53, or 4.9 per cent, to $75.07 in morning trading. The Dallas company’s stock has climbed in recent weeks on speculation about a possible sale. Since Dec. 22 the stock is up 22.2 per cent.
Shares of Martin Marietta rose $6.42, or 6.3 per cent, to $109.20.
Martin Marietta will also assume $700 million in Texas Industries’ debt. It expects the deal to add to its net income in 2014 excluding one-time costs and assuming it is able to refinance the debt.
Martin Marietta sells granite, limestone, sand and gravel, and it had $2.16 billion in revenue in 2013. Texas Industries makes cement and building materials, and it had $697 million in revenue in its latest fiscal year.
The companies said that together, they have more than 400 quarries, mines, distribution yards, and plants in 36 states, Canada, the Bahamas and the Caribbean Islands. The combined company will keep the Martin Marietta Materials name and its headquarters in Raleigh, N.C. Martin Marietta executives, including president and CEO Ward Nye, will remain in charge and one person jointly selected by Martin Marietta and Texas Industries will be appointed to the board.
The companies say their boards approved the deal. They expect it to close during the second quarter.
Martin Marietta said it expects increased construction activity in 2014 as the housing market continues to recover, and it also expects more private-sector construction because of work related to shale energy projects and some growth in public-sector work.
