Heidelberg Materials has struck a deal to buy Giant Cement Holding and its subsidiaries for $600m, the latest acquisition by the German cement maker to expand its foothold in the US.
Heidelberg Materials, the world's second-largest cement maker, and its larger peer, Holcim, have singled out the US market as a place to grow aggressively, banking on what they say will be prolonged construction activity due to infrastructure projects and economic stimulus.
Shares of European construction firms have risen on hopes that President-elect Donald Trump's administration could be positive for US construction activity.
"The acquisition will further strengthen our cement footprint in the growing Southeastern US and New England markets," said Chris Ward, the CEO of Heidelberg Materials North America.
The transaction, which will be completed in the first quarter of 2025, is expected to contribute around $60m in earnings before interest, taxes, depreciation and amortisation in the first year of operation, "before significant additional synergies", the company said in a statement.
The German company bought three US companies in June for $380m in total.
"The valuation (10x forward EBITDA) is not cheap, but the US market has an attractive structure and growth potential," Davy Research wrote in a note.
Heidelberg Materials scaled back its American presence three years ago when it sold cement factories in the western US for $2.3 billion.
Giant Cement Holding is owned by Mexican billionaire Carlos Slim's Spanish cement and real estate unit Inmocemento, which will book a capital gain of $145m on the asset sale, the Spanish company said in a separate filing to the Spanish stock market regulator.
Grupo Carso, another Slim holding based in Mexico, said in a filing the deal required the spin-off of Keystone Cement Company and some non-operating plots of land belonging to other units.
Inmocemento was spun off from Slim's Spanish conglomerate FCC earlier this month.
