Argos North America and Summit Materials Combine to Create a Stronger Force in the U.S. Construction Materials Industry

Cementos Argos today announced it has entered into a definitive agreement with Summit Materials, Inc. (NYSE:SUM) under which the U.S. operations of Cementos Argos, Argos North America Corp, will combine with Summit in a cash and stock transaction valued at $3.2 billion.

“This combination accelerates the strategic growth plans for both Argos North America and Summit,” said Simon Bates, CEO of Argos North America. “As a result of the combination, our ability to share best practices and the increased access to aggregate sources will enable us to better serve our customers.”

Key Highlights of the Transaction:

• Substantial Equity Stake in NYSE Listed Company: Cementos Argos will achieve a strategic objective of acquiring a substantial equity stake in a New York Stock Exchange listed company through its 31% ownership stake in Summit, while becoming a more vertically integrated construction materials provider in the U.S., offering new opportunities for growth and visibility.
• Expanded Footprint: The transaction is expected to result in an expanded and more robust geographic presence, positioning the combined organization to better serve diverse markets and customers across the U.S. The combined organization will have a significant presence in major urban markets spanning 30 U.S. states. It will benefit from vertical integration in cement production, aggregates and ready-mix, as well as a strategic network of ports and terminals to complement local capacity.
• Efficiencies: This combination unlocks estimated annual synergies of approximately $100 million per year, derived from optimized sourcing, enhanced operational efficiency, increased utilization of the import terminals' network, and an augmented asset base to increase the use of alternative fuels.

“This agreement enables Cementos Argos to fulfill its strategic goal of generating greater economic value for shareholders,” said Juan Esteban Calle, Cementos Argos CEO. “It aligns with the company's objective of holding a substantial stake in a NYSE-listed company and leverages a platform with a proven track record of growth, enabling substantial potential for future expansion and profitability. Argos will continue to contribute its business knowledge and leadership in sustainability initiatives as part of the combined organization’s Board of Directors while further solidifying its growth and value proposition in the other countries in the Americas where it has a presence.”