Martin Marietta, Texas Industries approve merger

By |  January 30, 2014

Martin Marietta Materials Inc. and Texas Industries Inc. approved a merger agreement whereby Martin Marietta will acquire all outstanding shares of Texas Industries’ common stock in a tax-free, stock-for-stock transaction. The combined company, which will operate under the Martin Marietta Materials Inc. name, will have an enterprise value of approximately $8.5 billion based on the Jan. 27 closing market prices for the shares of both companies.

The combined company will be a leading supplier of aggregates and heavy building materials, with low-cost, vertically integrated aggregate and targeted cement operations, according to Martin Marietta.

“By uniting Martin Marietta’s and Texas Industries’ complementary assets and leveraging an expanded geographic footprint, we will be even better-positioned to deliver value to our shareholders and customers,” says Ward Nye, Martin Marietta’s president and CEO. “Texas Industries’ aggregates operations are strategically located in high growth markets and fit well into our existing portfolio, and its cement operations will further diversify our product and customer mix.”

Under the terms of the agreement, Texas Industries shareholders will receive 0.700 Martin Marietta shares for each share of Texas Industries common stock they own at closing. Martin Marietta shareholders are expected to own approximately 69 percent and Texas Industries shareholders are expected to own approximately 31 percent of the combined company. The companies anticipate closing the transaction in the second quarter of 2014, subject to shareholder approval.

“Combining with Martin Marietta represents a unique opportunity to create a more competitive company with a solid, diversified portfolio of assets, enhanced credit profile and a strong balance sheet,” says Mel Brekhus, Texas Industries’ president and CEO.

Martin Marietta says the addition of Texas Industries will add approximately 800 million tons of aggregates reserves, bringing the total to more than 13.5 billion tons. In addition, Texas Industries increases Martin Marietta’s presence in the Southwest, with cement production facilities concentrated primarily in Texas and California – two of the largest and fastest growing markets for construction materials in the United States, says the company.

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