Summit Materials reportedly makes bid for Ash Grove Cement

By |  October 6, 2017

After CRH had agreed to pay $3.5 billion for Kansas-based Ash Grove Cement, Summit Materials has made a rival offer for the cement maker, says Reuters.

According to Reuters’ sources, Ash Grove has received a bid from Summit Materials valued at between $3.7 and $3.8 billion. Reportedly, the offer is being considered by Ash Grove’s board, while CRH says its proposal remains in place, subject to approval from Ash Grove shareholders.

Ash Grove has set a Nov. 1 meeting for shareholders to vote on the agreement with CRH, which its board unanimously approved last month. But the company has extended the period during which it can look for other potential buyers to Oct. 20, Ash Grove officials said in a statement.

Reuters says that prior to establishing Summit Materials in 2009, the company’s CEO Thomas Hill headed up CRH’s North American subsidiary, and brought with him other U.S.-based CRH executives.

Summit Materials’ offer, according to Reuters, would surpass its own value of $3.65 billion. CRH, on the other hand, has a market capitalization of $26.3 billion and said last month that it has about 5 billion euros available to spend on acquisitions over the next 18 to 24 months. The bid it made for Ash Grove Cement was an all-cash bid.

CRH is also Ash Grove’s largest customer and would be owed a $131 million termination fee if the Kansas-based company sells to another party.

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