Pit & Quarry, August 2017
UPDATE in Georgia and South Carolina enhances Martin Mariettas existing footprint in those states If you think about markets like Georgia and South Carolina they have tremendous opportunity for synergies there Reddin says Acquiring an aggregate producer such as Bluegrass was fundamental to Martin Mariettas strategy according to Reddin This was a must have deal for their growth strategy for their market extension and for just keeping up in the game he says AnoThER PRIvATE EQUITY DEAl Also like Vulcans acquisition of Aggregates USA Martin Mariettas Bluegrass deal involves a private equity firm seizing the opportunity to cash out of an investment while the market dynamics are ideal In Bluegrass case one of the sellers is Lindsay Goldberg LLC which reportedly stands to make a return more than three times greater than the capital it invested seven years ago Private equity firms want to generate returns for their partners in as short a time period as possible three four five years is the sweet spot Reddin says The capital is patient up to a point A lot of people would say seven years is near the outside of the ideal hold period Here we are at seven years with Bluegrass as the initial investment was made in 2010 I think this was an opportune time for Lindsay Goldberg to sell with the market in its current shape and just based on their private equity model lookIng AhEAD Now that Bluegrass has moved plus considering that Vulcan is acquiring Aggregates USAs assets Reddins expectation is for more deal making albeit of the small to medium sized variety This is going to help ignite the smallto medium sized deals in the sector Reddin says You have a lot of family owned or influenced businesses watching all of this Theyre starting to have conversations along the lines of maybe now is the right time to sell So expect to see a slew of these sorts of deals over the next couple of years I think well see that wave Reddin says It will be more of the small strategic bolt on and medium size platform type of deals Those tend to be somewhere in the 25 million to 150 million range The mega deal may still emerge from time to time Reddin says But dont expect those to purely involve aggregate assets Youll still see some large deals but likely including cement ready mix and asphalt he says Theres just not that many of these Aggregates USA or Blue MINCON IS PEOPLE PERFORMANCE ENGINEERING 46 PIT QUARRY August 2017 pitandquarry com
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