Wednesday, Nov. 19, 2003 | 10:50 a.m.
SUN STAFF AND WIRE REPORTS
Aggregate Industries, a British company, Tuesday announced the acquisition of Southern Nevada Paving Co. Inc., a major aggregate, asphalt and contracting business in Las Vegas.
The consideration, paid in cash, amounts to $64.1 million (U.S.) subject to an adjustment for working capital.
The acquisition continues Aggregate's strategy of earnings-enhancing bolt-on acquisitions, the London company said. The purchase comprises the share of Southern Nevada Paving Company Inc., Nevada Paving, Inc. and Valley Trucking Inc.
Before the sale, Southern Nevada Paving was owned by Floyd Meldrum and his wife Jeri for 41 years.
Floyd Meldrum, who will stay with the company as a consultant, said he sold the company to pursue other interests.
"After 41 years you want to do something besides supervise 500 (full-time) employees every day," he said.
Floyd Meldrum said he owns some land in Southern Nevada and plans to develop his properties.
Southern Nevada Paving's net assets at year-end 2002 amounted to $47.6 million stated before any review of valuation of plant and mineral reserves. Sales in 2002 amounted to $101 million and the businesses reported earnings before interest, tax, depreciation and amortization (cash flow) of $16.9 million and a pre-tax profit of $9.3 million.
Southern Nevada Paving owns a freehold half-interest in the 530 acre Sloan Mountain Quarry, which has more than 650 million tons of high quality limestone, and will be transferred to Aggregate Industries PLC.
Southern Nevada Paving also operates four asphalt plants and is a leading asphalt paving operator in Nevada. In the year ended Dec. 31, the business produced 3.6 million tons of aggregate and recycled aggregate, 1.2 million tons of asphalt and laid approximately 1 million tons of asphalt.
Aggregate Industries said it intends to establish a significant presence in the Las Vegas area by exploiting its substantial aggregate reserves through increased downstream distribution and by making further selective bolt-on acquisitions.
Peter Tom, group chief executive of Aggregate Industries said the purchase is a major boost to its U.S. market share in aggregate, asphalt and asphalt paving.
"Las Vegas represents a significant geographic expansion into a region which is unaffected by seasonal variations and offers Aggregate Industries considerable opportunities to develop both organically and by acquisition," Tom said.
Mr. Meldrum said he is thankful for his 41 years of business.
"We're proud to help with the growth of Southern Nevada and thankful for the people and that we were able to work with on a variety of projects throughout the state and in Southern Nevada," he said.
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