Vulcan Materials is buying Polaris Materials Corporation, an aggregates and logistics company, which serves California from British Columbia.
The Polaris business includes an aggregates processing plant and deep water port on Vancouver Island along with associated long term aggregate reserves and five distribution yard outlets in the San Francisco Bay Area and in Long Beach, California.
“We are very pleased to have reached agreement to acquire Polaris Materials, which is expected to further enhance our ability to serve major California markets,”said Tom Hill, chief executive, Vulcan.
“With this acquisition, we are continuing to build on our industry-leading position in the state of California. Polaris has assembled high quality aggregate reserves that will further expand our product offerings, particularly for certain concrete applications, as well as our geographic coverage in markets in the San Francisco and Los Angeles metro areas.”
“This acquisition will enhance our logistics capabilities with the ship delivery of aggregate products and provide Vulcan with a platform for future distribution outlet opportunities along the Pacific Coast.”
“The acquisition is especially timely given California’s recent passage of SB1, which will provide $52 billion for key transportation infrastructure projects over the next ten years, in addition to passage of local ballot measures that add more than $1 billion annually for infrastructure projects in key growth markets that we serve.”
The cash purchase price represents a 191% premium to Polaris’ closing share price of C$0.96 on August 25, 2017 and a 194% premium to the volume weighted average price of Polaris’ shares over the last 10 trading days.
Completion of the Arrangement is subject to customary closing conditions, including approval of Affected Securityholders and court approval, and is expected to close in November 2017.
Ken Palko, chief executive, Polaris, said: “With Polaris celebrating its 10 year anniversary of operations at the Orca quarry this year, we recognize our First Nations partners, employees, customers, service providers and other stakeholders as instrumental in creating this exceptional construction materials company.
“The unique strategic merits of our Company have been recognized by Vulcan, and this transaction provides significant value to Polaris shareholders today, while positioning our business to provide long term benefits to our partners and opportunities for growth in the future.”