(DOW JONES) Hanson said July 22 that it has sold its ready-mixed concrete operations in Texas and Arkansas while reinforcing its position in its key U.S. aggregates markets through the completion of the previously announced Better Materials transaction and other bolt-on acquisitions and swaps.
Alan Murray, chief executive, said: “Since the beginning of the year, Hanson has completed cement and ready-mixed concrete disposals in Texas totaling $202 million. In line with our stated strategy of expanding in our core products and markets, we have successfully reinvested these proceeds and swapped assets in value-adding transactions which build up existing operations, principally in U.S. aggregates.
“In addition, the net effect of the transactions completed in the year to date is to increase Hanson’s planned mineral reserves by over 650 million tons.”
Hanson has sold the ready-mixed concrete operations in Texas and Arkansas it acquired with Pioneer International Limited in 2000 to Southern Star Concrete Inc., a portfolio company of the Texas Growth Fund, for $77 million in cash, subject to final adjustments.
The sale involves 63 active ready-mixed concrete plants and associated distribution assets which serve the Dallas/Fort Worth and Houston markets as well as rural markets in east Texas and central/south Arkansas.
In the first half of 2003, ready-mixed concrete shipments from these operations totaled 2.6 million cu. yds. and their EBITA contribution was $1 million. The sale does not include Hanson’s 50-percent interest in Houston-based Campbell Concrete and Materials L.P.
This disposal follows the completion in January 2003 of the sale of Hanson’s 50-percent interest in North Texas Cement Company for $125.4 million in cash. Hanson said it has no ambitions to be a major cement producer and will only hold ready-mixed concrete assets in those markets where needed to provide a secure outlet for its aggregates production.
Hanson plans to retain its leading position in the Texas aggregates market and to continue to benefit from an aggregates supply agreement with the ready-mixed concrete operations.
Hanson’s bolt-on acquisitions in the first half of 2003 have totaled approximately $48 million. In North America, they include an aggregates quarry in Cincinnati, OH, and another in London, KY.
Since the end of June, Hanson has completed its previously announced acquisition of U.S. aggregates producer, Better Materials Corporation, which will increase Hanson’s aggregates position in Pennsylvania and provide a new presence in New Jersey.
In addition, Hanson has signed a contract to acquire the business of Wagner Quarries Company, an independent owner of a limestone quarry in northern Ohio.
In July, Hanson also completed an asset exchange with Oldcastle Materials Inc., whereby Hanson transferred seven rural quarries in Alabama, Georgia, Tennessee and Michigan for assets including five quarries that complement Hanson’s existing northern Indiana and northern Ohio operations.