Martin Marietta Materials, Inc.
Texas Industries, Inc.
) recently received approval for their proposed merger from
majority of their shareholders. About 98% of Martin Marietta and
99% of Texas Industries shareholders have voted for the acquisition
deal announced on Jan 28.
Per the definitive merger deal, Martin Marietta will acquire all
the outstanding shares of Texas Industries, a manufacturer of heavy
construction materials in Southwestern U.S. Accordingly, Texas
Industries will become a wholly-owned subsidiary of Martin Marietta
According to the agreement, Texas shareholders will receive 0.7
Martin Marietta shares against every Texas share they own.
The companies have now got all required regulatory approvals for
closing the acquisition. However, in order to close the deal,
Martin Marietta must divest its North Troy aggregate quarry in Mill
Creek, OK and its two rail yards sites in Dallas and Frisco, TX, as
per the requirement of U.S. Department of Justice (DOJ).
The waiting period related to the merger under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976 has been
terminated. With the approval from shareholders, the transaction is
expected to be closed promptly.
Headquartered in Raleigh, NC, the combined company will have an
enterprise value of $8.5 billion and will be headed by Ward Nye and
the Martin Marietta executive team.
With the completion of the acquisition, Martin Marietta is expected
to become the largest producer of construction aggregates and heavy
building materials, which includes crushed stone, sand and gravel.
Texas Industries will strengthen Martin Marietta's aggregate
reserves and access to high end markets such as Texas.
The merger will also result in vertical integration across
aggregates and targeted cement, which will increase productivity
and scale of production. The combined company will benefit from an
increase in geographic diversity and combined access to a larger
Martin Marietta Materials carries a Zacks Rank #4 (Sell).
Investors interested in the building construction/building products
sector can consider stocks like
TRI Pointe Homes, Inc.
). Both the companies hold a Zacks Rank #2 (Buy).
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