Hill's Summit spends €420m to buy Lafarge operations
Published 19/04/2015 | 02:30
Tom Hill, the former chief of CRH's US operations, has spent almost €420m to buy a portfolio of assets being sold by cement group Lafarge ahead of its proposed merger with Holcim. Hill set up cement buyout firm Summit Materials after leaving CRH.
The firm floated on US stockmarkets last month raising around €350m.
The Trinity College-educated Hill had been widely tipped to take over as chief executive of CRH when Liam O'Mahony stepped down in 2008. He had worked in the company for 28 years before helming up its extensive North American business. Running the US operations had been traditionally a springboard to becoming chief executive of CRH - Ireland's most valuable company. However, CRH appointed its finance chief Myles Lee to the job following a lengthy selection process.
Hill left CRH soon after Lee was appointed, receiving a €2.2m compensation package.
Soon after departing CRH, Hill teamed up with private equity groups Blackstone and Silverhawk Capital Partners LLC to create Summit which has been buying up assets being sold off by larger cement and materials groups in a bid to create a new and more focussed market player.
Since it was established in 2009, the firm has bought 34 cement, asphalt and concrete companies in a M&A spree, bankrolled by its private equity partners. The deal to buy the Lafarge 'Davenport' assets, which include an Iowa cement plant and seven distribution terminals, will be funded by a mixture of debt and equity.
"The Davenport Assets are an excellent fit with our growth strategy and a continuation of Summit's track record of value-added acquisitions," Hill said last week.
Summit was valued at just over €1.54bn when it floated on NYSE in mid-March, since then its share price has risen sharply, with markets reacting positively to the latest deal. Hill's former colleagues and employers at CRH are also picking through the assets of Lafarge and Holcim as competition regulators force the two companies to sell off businesses ahead of a merger deal. CRH has already agreed to buy Holcim and Lafarge assets worth €6.5bn.
Sunday Indo Business