Martin Marietta complete Texas Industries acquisition

Transaction creates market-leading supplier of aggregates and heavy building materials

MARTIN Marietta Materials Inc. have completed their acquisition of Texas Industries Inc. (TXI), creating a market-leading supplier of aggregates and heavy building materials and enhancing their position as an aggregates-led, low-cost operator in the largest and fastest growing geographies in the US.

Together with a leading US aggregates position, the acquisition also provides complementary, high-quality assets in cement and ready-mixed concrete.

The transaction was overwhelmingly approved by shareholders of both companies, and based on the closing price of Martin Marietta stock on 1 July 2014, the combined company has a market capitalization of approximately US$8.8 billion.

Ward Nye (pictured), Martin Marietta’s chairman, president and chief executive officer, said: ‘We are excited to move forward as one company that is even better positioned to deliver increased value to shareholders, customers and employees.

‘Uniting our complementary assets and leveraging our expanded geographic footprint provides Martin Marietta with an expanded platform for growth. In particular, Martin Marietta will benefit from greater exposure to the expanding cement markets in Texas and California – two of the largest and fastest growing markets for construction materials in the US.

‘I look forward to continuing to work closely with our team and all of our employees, including our new team members from TXI, to ensure a seamless transition as we continue to deliver superior product offerings and service to customers.’

Martin Marietta say they expect the combined company to generate approximately US$70 million of annual pre-tax synergies by 2017, which would correspond to more than US$500 million of total value creation for shareholders.

Integration of the acquired business is under way and the transition to the company’s target operating model is expected to be completed by the end of the year. The combination is expected to be both accretive to Martin Marietta’s earnings per share in 2014, excluding one-off costs, and cash flow accretive in the first full year following integration.