Martin Marietta To Buy Privately Held Bluegrass In $1.625 Bln Cash Deal

(RTTNews) - Martin Marietta Materials Inc. (MLM), a supplier of building materials, announced Monday that it has entered into a definitive agreement to buy Bluegrass Materials Co. for $1.625 billion in cash.

Bluegrass, a unit of Panadero Aggregates Holdings, LLC, is the largest privately-held, pure-play aggregates company in the United States, and operates 23 active sites.

It is expected that Bluegrass, as the leading aggregates producer in Maryland, will provide Martin Marietta with a strategic new growth platform within the southern portion of the Northeast Megaregion. With aggregates shipments currently 20% to 30% below peak levels, all of these markets are expected to benefit from the accelerating economic recovery in the eastern United States.

Martin Marietta expects annual run-rate cost savings of approximately $15 million. Including synergies, the purchase price represents a multiple that is in-line with recently completed aggregates transactions.

Martin Marietta expects the transaction to be accretive to earnings per share and cash flow in the first full year.

The transaction is expected to close in the fourth quarter of 2017, subject to regulatory approvals and other customary closing conditions.