Argos USA is among the largest cement producers by total installed capacity in its area of operations, which includes the Southeast, Mid-Atlantic, and Texas. Its asset footprint comprises four integrated cement plants, around 140 ready-mix plants, and eight ports.
Argos USA has an installed cement grinding capacity of 9.6 million tons a year, Summit says, with additional import capacity providing incremental scale and operational flexibility. About 85% of Argos USA’s EBITDA is generated from its cement platform.
The combination of Summit and Argos USA, earmarked for completion in H1 2024, will create the fourth-largest cement platform in the US and accelerate Summit's Elevate Summit strategy, enhancing the company's materials-led approach and positioning it for even greater success with a national footprint and significantly improved scale.
Summit says the deal will generate more than $100mn of annual operational synergies via improved plant productivity and operational excellence initiatives, sourcing and SG&A optimisation, and fleet modernisation.
"Combining Argos USA with Summit is a significant milestone as we execute against and accelerate our materials-led portfolio strategy," says Anne Noonan, president and CEO of Summit. "The transaction will extend our geographic reach into high-growth markets, creating a leading cement enterprise nationwide and [bringing] together two talent-rich organisations to innovate and deliver value-added solutions for our customers.
"Financially, we have clear line of sight to achieving targeted synergies of more than $100 million annually as we unlock the full potential of this powerful combination," Noonan adds. "The Argos USA team has done an excellent job growing and operating its business, and we look forward to welcoming them and their expertise to the Summit family."
Jorge Mario Velasquez, board chairman at Cementos Argos SA, said: "We believe in the growth potential and value generation that this transaction offers, and we want to actively participate jointly with the Summit family by contributing our knowledge and expertise to drive that growth."
Following the conclusion of the transaction, the combined company will be led by Anne Noonan.