© Reuters. Martin Marietta Materials (MLM) to acquire 20 Blue Water Industries units for $2.05bn
Martin Marietta Materials (NYSE:) announced Monday that it has entered into an agreement to acquire 20 active aggregate operations from Blue Water Industries for $2.05 billion in cash.
The operations are located in Alabama, South Carolina, South Florida, Tennessee, and Virginia. MLM said the BWI Southeast deal will be financed with cash from the balance sheet and is expected to close later this year.
The company also revealed that on February 9, it completed its previously announced divesture of its South Texas cement and related concrete operations to CRH Americas Materials for $2.1 billion in cash.
The company believes the transactions improve its product mix, margin profile, and durability through cycles, as well as provide it with balance sheet flexibility for “future acquisitive and organic growth.”
“These transactions are wholly consistent with the Company’s SOAR (Strategic Operating Analysis and Review) 2025 aggregates-led product strategy,” said Ward Nye, CEO of Martin Marietta. “Importantly, the BWI Southeast acquisition complements Martin Marietta’s existing geographic footprint in the dynamic southeast region by allowing us to expand into new growth platforms in SOAR-specific target markets, including Nashville and Miami.”
Reacting to the news, analysts at Jefferies maintained a Buy rating and $590 per share price target on MLM, stating that the company selling its Hunter cement assets and swapping them for aggregates assets, and paying a low-to-mid teen multiple is “a great outcome and should allow MLM to unlock value and re-rate higher.”
“We still expect chunkier deals to come this year, and estimate MLM has ~$4.2 bil of firepower they can deploy,” the analysts added.