Pit & Quarry, August 2017
UPDAte Analysis What Martin Mariettas purchase of Bluegrass means by Kevin YaniK Two major transactions involving aggregate producers have gone down in the course of a month First it was Vulcan Materials Co acquiring Aggregates USA LLC in a 900 million deal Now Martin Marietta Materials Inc is purchasing Bluegrass Materials Co for 1625 billion What does this deal mean for Martin Marietta and what effects will it have on the market FMI Capital Advisors Inc s George Reddin provides some insights This deal was important for Martin Marietta as they really strive where possible to stay as a pure aggregate producer and dodge vertical integration says Reddin managing director at FMI Bluegrass does indeed fit the mold Reddin describes By Martin Mariettas definition Acquiring a producer such as Bluegrass whose Texas Quarry in Cockeysville Maryland is pictured was fundamental to Martin Mariettas strategy Bluegrass is the largest privately held pure play aggregates company in the United States So on makeup alone Bluegrass is a match for Martin Marietta according to Reddin Historically Martin Marietta has done fewer deals than a lot of companies but theyll do the bigger deals and spend a lot of time on greenfield sites the productivity of their operation and reinvesting in the business to make them more efficient he says So I would think that model would continue Other benefits The Bluegrass deal also offers Martin Marietta access to new markets and it positions Martin Marietta to potentially expand further Reddin says The other part of the deal is a market extension to Maryland and Delaware he says That positions them to look into Pennsylvania and the Northeast But in the Northeast they would run into some more vertically integrated markets and union operations In addition acquiring Bluegrass assets PLATE FRAME PRESS 44 Pit QUArrY August 2017 pitandquarry com Photo by Megan SMalley Design Construction of Fines Recovery Equipment Doing What We Do Best HIGH RATE THICKENER FRACTIONATOR VERTICAL DURABILITY CELL SUPER CUTTER HYDRO CYCLONE DEWATERING SCREEN Learn More Call 866 616 9351 or Visit www azfab com Providing Solutions
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