Martin Marietta Materials to acquire Bluegrass

Martin Marietta Materials Inc and Bluegrass Materials Company announced that they have entered into a definitive agreement under which Martin Marietta will acquire aggregates company Bluegrass for US$1.625bn in cash.

Bluegrass is the largest privately-held, pure-play aggregates company in the United States, with a portfolio of more than 125 years of high-quality reserves. Bluegrass operates 23 active sites across Georgia, South Carolina, Maryland, Kentucky and Tennessee, generating consolidated EBITDA margins that are consistent with those in Martin Marietta's Southeast and Mid-Atlantic Divisions that the company views as best-in-class.

Martin Marietta commented in a statement that Bluegrass' Georgia and South Carolina operations complement complement its existing southeastern footprint while expanding the range of products that can be provided to both new and existing customers. "As the leading aggregates producer in Maryland, Bluegrass will provide Martin Marietta with a strategic new growth platform within the southern portion of the Northeast Megaregion, serving the Baltimore, Frederick, Hagerstown and Maryland Eastern Shore metropolitan areas as well as Delaware. With aggregates shipments currently 20-30 per cent below peak levels, all of these markets are expected to benefit from the accelerating economic recovery in the eastern United States. Additionally, Bluegrass has leading positions in Bowling Green and eastern Kentucky and an attractive position in Tennessee," Martin Marietta said.

The transaction is expected to close in the 4Q17, subject to regulatory approvals and other customary closing conditions.