Hanson Strengthens Footing in Texas

North America's Largest Brick Manufacturer Acquires Athens Brick for $40 Million

By Sean Donahoe

Hanson Brick and Tile announced in March that the N.C.-based company had purchased brick manufacturer Athens Brick from Dallas-based Texas Industries for $40.4 million.

As part of Hanson Brick's South Central region, Athens, a brick manufacturer with plants in Mineral Wells and Athens in Texas and Mooringsport, La., will continue to serve major markets in Texas and surrounding states with a combined annual production capacity of 90 million bricks and control of about 20 years worth of clay and shale reserves.

The additions will increase Hanson's production capacity in the region to 450 million bricks across eight plants and strengthen the company's footing in an area with significant growth potential.

The purchase of Athens comes on the heels of several major Hanson acquisitions.

Hanson Brick's parent company, Hanson PLC, is an international building-materials company with more than 28,000 employees and operations in 17 countries. In 1999 Hanson PLC's subsidiary, Hanson Building Products North America, acquired seven major brick manufacturers across North America, including U.S. Brick of Texas and facilities in four other U.S. states and two in Canada

advertisement

Last year Hanson PLC began consolidating and rebranding its seven brick businesses into a unified company. With the acquisition of Athens, Hanson now has 25 plants across North America and an annual production capacity of nearly 1.7 billion bricks, making it the third-largest manufacturer in the United States and the largest in North America. The company offers five regional brick collections that include more than 1,000 styles.

"With the consolidation of our North American brick businesses well under way, we are excited to be able to make this significant addition to our existing operations, said Mike Donahue, president of Hanson Brick & Tile. "While we expect some operating efficiencies as a result of the combination, the true advantages are the enhanced product offering and increased capacity that will benefit our customers in this dynamic region of the country."

The sale was good news for Texas Industries as well. The supplier of cement and structural steel posted net income of $20.9 million, or 92 cents a share, for the fiscal quarter ending Feb. 29, compared with a loss of $17 million, or 81 cents a share, one year ago. The results included a gain of $20.5 million, or 90 cents a share, from "the sale of brick plants."

Athens Brick generated unaudited revenues for its fiscal year ending May 31, 2003, of $14.7 million and earnings before interest, taxes, depreciation and amortization of $6.5 million on the sale of 84 million bricks.

"The acquisition of Athens is consistent with Hanson's strategy of pursuing bolt-on acquisitions where we can enhance existing strong positions in our core products and markets, said Richard Manning, president of Hanson Building Products North America. "Athens will strengthen our presence in the South Central region and is anticipated to be earnings enhancing from the outset."

Related Stories

Clear Creek ISD
Saginaw ISD
A&M
Amarillo