Martin Marietta (MLM) Proposed Business Combination with Vulcan Materials (VMC)
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Martin Marietta Materials, Inc. (NYSE: MLM) today announced that it has delivered a proposal to Vulcan Materials Company (NYSE: VMC) and commenced an exchange offer to effect a business combination with Vulcan that would create a U.S.-based company that is the global leader in construction aggregates with a footprint reaching across North America. As of December 9, 2011, the combined market capitalization was $7.7 billion and the combined total enterprise value was $11.4 billion. The combined mineral reserves of the two companies would be 28 billion tons.
The proposal, including the exchange offer, has the unanimous support of the Martin Marietta Board of Directors. Under the terms of the exchange offer, each outstanding share of Vulcan will be exchanged for 0.50 Martin Marietta shares. The offer represents a premium for Vulcan shareholders of 15% to the average exchange ratio based on the closing share prices for Vulcan and Martin Marietta during the 10-day period ended December 9, 2011 and 18% to the average exchange ratio based on the closing share prices for Vulcan and Martin Marietta during the 30-day period ended December 9, 2011.
Martin Marietta’s proposal contemplates directors from both Martin Marietta and Vulcan serving on the combined company's Board. Furthermore, it proposes Don James, Vulcan’s Chairman and Chief Executive Officer, serve as Chairman of the Board, and that Ward Nye serve as President and Chief Executive Officer, with executives from both companies on the senior management team. Under the proposal, the combined company would be headquartered in Raleigh, North Carolina, where Martin Marietta is based, and maintain a major presence in Birmingham, Alabama, where Vulcan is based.
The proposal, including the exchange offer, has the unanimous support of the Martin Marietta Board of Directors. Under the terms of the exchange offer, each outstanding share of Vulcan will be exchanged for 0.50 Martin Marietta shares. The offer represents a premium for Vulcan shareholders of 15% to the average exchange ratio based on the closing share prices for Vulcan and Martin Marietta during the 10-day period ended December 9, 2011 and 18% to the average exchange ratio based on the closing share prices for Vulcan and Martin Marietta during the 30-day period ended December 9, 2011.
Martin Marietta’s proposal contemplates directors from both Martin Marietta and Vulcan serving on the combined company's Board. Furthermore, it proposes Don James, Vulcan’s Chairman and Chief Executive Officer, serve as Chairman of the Board, and that Ward Nye serve as President and Chief Executive Officer, with executives from both companies on the senior management team. Under the proposal, the combined company would be headquartered in Raleigh, North Carolina, where Martin Marietta is based, and maintain a major presence in Birmingham, Alabama, where Vulcan is based.
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