RALEIGH, N.C. - Martin Marietta Materials, Inc. (NYSE: NYSE:MLM), an American-based supplier of building materials, announced Monday it has struck a deal to acquire 20 aggregates operations from Blue Water Industries LLC (BWI Southeast) for $2.05 billion in cash. The acquisition, which occurred on Sunday, is part of the company's strategic expansion in the southeast United States.
This move follows the company's recent completion of a divestiture on Friday, February 9, 2024, where it sold its South Texas cement and concrete operations to CRH (NYSE:CRH) Americas Materials, Inc. for $2.1 billion in cash. This transaction is in line with Martin Marietta's efforts to optimize its portfolio, focusing on aggregates-led product strategy and improving its margin profile.
The newly acquired operations are located across Alabama, South Carolina, South Florida, Tennessee, and Virginia, and are expected to complement Martin Marietta's existing footprint, particularly in the growing markets of Nashville and Miami. With these acquisitions, the company anticipates an addition of approximately 1 billion tons of high-quality reserves and projects an annualized EBITDA of more than $180 million.
Ward Nye, Chairman, President, and CEO of Martin Marietta, highlighted that these transactions align with the company's SOAR (Strategic Operating Analysis and Review) 2025 strategy, aimed at reinforcing its position in the aggregates sector and providing a strong foundation for both acquisitive and organic growth.
The purchase of BWI Southeast's operations will be funded using the company's balance sheet cash and is expected to close later in the year, subject to regulatory approvals and customary closing conditions.
Martin Marietta is a leading supplier of aggregates and heavy building materials, with operations spanning 28 states, Canada, and The Bahamas. The company is also known for its Magnesia Specialties business, which produces magnesia and dolomitic lime products.
More details about these transactions, as well as Martin Marietta's full-year results and 2024 outlook, will be shared during the company's fourth-quarter and full-year 2023 earnings call on Wednesday, February 14, 2024.
This news is based on a press release statement from Martin Marietta Materials, Inc.
InvestingPro Insights
Martin Marietta Materials, Inc. (NYSE: MLM) has shown remarkable financial resilience and investor confidence, as evidenced by its robust InvestingPro metrics and strategic business maneuvers. As the company fortifies its presence in the Southeast U.S. with the recent acquisition, it's worth noting that it has been trading near its 52-week high, with the price at 99.9% of this peak. This reflects strong market sentiment and the company's solid performance trajectory.
An InvestingPro Tip that stands out for Martin Marietta is its high return over the last year, with a 1 Year Price Total Return of 51.09%. This impressive return is indicative of the company's robust growth strategy and operational efficiency. Moreover, Martin Marietta has raised its dividend for 8 consecutive years, showcasing a commitment to delivering shareholder value. The company's dividend growth over the last twelve months stands at 12.12%, reinforcing its reputation as a consistent and reliable income stock.
From a valuation perspective, the company's P/E Ratio is currently at 30.44, which, while on the higher end, is supported by a strong and stable financial performance. The company's revenue growth for the last quarter was 10.07%, indicating a positive business momentum that may justify the premium valuation.
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