Cemex, Eagle Materials Enter Agreement for Ohio Assets

One of Cemex’s U.S. subsidiaries has signed a definitive agreement with Eagle Materials for the sale of its Fairborn, Ohio, cement plant, as well as related assets, which include a distribution terminal in Columbus, Ohio, and a cement bagging operation. The Fairborn plant has the capacity to grind nearly one million tons of clinker annually.

The purchase price is $400 million, subject to customary post-closing adjustments. The proceeds obtained from this transaction will be used mainly by Cemex for debt reduction and for general corporate purposes.

Eagle Materials anticipates certain tax benefits arising from the transaction, the net present value of which is expected to be approximately $50 million. Calendar 2016 revenue and EBITDA for the acquired assets is estimated to be $79 million and $33 million, respectively. The acquisition will increase Eagle Material’s U.S. cement capacity by roughly 20 percent and is expected to be accretive to earnings immediately post-closing.

Dave Powers, Eagle Materials president and CEO, said the agreement represents a significant step in the company’s growth strategy. “Our strategy has been to grow the cement side of our business. The Fairborn plant extends our U.S. cement system and connects but does not overlap with the market reach of our existing plants. This high-quality cement plant is a compelling fit with our strategic objectives and our criteria for new investment. These assets will allow us to participate more fully in the U.S. construction industry and further positions the company in target U.S. Heartland growth markets.”

The transaction is expected to close in the fourth quarter of 2016, or shortly thereafter, following the receipt of required regulatory approvals.


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