After a failed attempt at a merger, Martin Marietta Materials has launched a hostile $4.8 billion offer for its rival Vulcan Materials Co., according to the Wall Street Journal. The deal combines the two largest suppliers of construction aggregates -- one of the chief ingredients of concrete -- in the nation.
Discussions about a possible merger occurred last year between the chief executives of Marietta Materials and Vulcan, according to regulatory filings. But the two CEOs could not agree on issues such as the executive management positions and shareholder premiums.
The all-stock offer arrived on Vulcan’s doorstep on Dec. 11 from the smaller of the two firms, Martin Marietta. The Raleigh, N.C.-based company is offering half a share for each Vulcan share, a 9% premium based on Vulcan’s Nov. 9 closing prices.
Vulcan, based in Birmingham, Ala., said in a prepared statement that its board is "carefully" reviewing the offer and will make a recommendation within 10 business days. It advised its shareholders not to sell their stakes before that time.
Martin Marietta's offer would combine the directors from both companies to serve on one board. Donald James, chairman and CEO of Vulcan, would serve as chairman; but C. Howard Nye, president and CEO of Martin Marietta Materials, would hold the post of president and CEO.
Martin Marietta is the second-largest supplier of crushes stoned, sand and aggregates in the United States. It also sells asphalt and concrete in certain geographic regions.
Vulcan is the country’s largest producer of construction aggregates and a major producer of other construction materials, including asphalt and ready-mixed concrete and a leading producer of cement in Florida.