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U.S. Concrete to Buy Polaris; Vulcan Deal Terminated


U.S. Concrete Inc. announced that it has entered into an arrangement agreement with Vancouver, Canada-based Polaris Materials Corp. pursuant to which U.S. Concrete will acquire all the issued and outstanding common shares of Polaris for C$3.40 per share in cash by way of a statutory plan of arrangement.

The price per share implies an aggregate fully diluted equity value for Polaris of approximately C$309 million. Additionally, Polaris has terminated the previously announced arrangement agreement between Polaris, Vulcan Materials Co. and a wholly-owned subsidiary of Vulcan dated Aug. 25, 2017.

Polaris' special meeting of security holders scheduled for Oct. 20, 2017, will be adjourned and a new special meeting of Polaris' security holders to consider the USCR Arrangement will be held on a date to be determined by the board of directors of Polaris.

The transaction represents a 22 percent premium to the C$2.79 per share transaction price pursuant to the terminated Vulcan Agreement.

Polaris' board of directors and a special committee consisting of the independent directors of Polaris have unanimously recommended that shareholders, option holders and deferred unit holders of Polaris vote in favor of the transaction contemplated by the USCR Arrangement Agreement.

In connection with the termination of the Vulcan Agreement, a termination fee was paid to Vulcan.

Polaris is permitted to terminate the USCR Arrangement Agreement in certain circumstances, including to allow Polaris' board of directors to accept a superior proposal subject to certain conditions, including USCR's "right to match" and payment of a termination fee.

Completion of the USCR Arrangement is subject to customary closing conditions, including approval of Affected Security holders and court approval, and is expected to close in the fourth quarter of 2017.

"We believe that Polaris is an ideal strategic fit and enables a replication in California of our vertically integrated business model that we successfully operate in New York," said U.S. Concrete's President, CEO and Vice Chairman William J. Sandbrook. "The acquisition of Polaris will provide U.S. Concrete with long-term, high-quality aggregate reserves and is expected to deliver meaningful synergies and strengthen the company's strategic position in the highly attractive, aggregate supply-constrained Californian markets. Following completion of the acquisition, U.S. Concrete expects to have the capability to self-supply a large majority of its market-leading ready-mixed concrete operations' aggregate requirements in Northern California and to drive increased production volumes at Polaris' Orca Quarry. The acquisition also provides us an entrance into Southern California through the Polaris-operated Long Beach Terminal."

"Vulcan is a disciplined buyer, and we believe that our prior agreement to acquire Polaris for C$2.79 per share represented full and fair value for the company," said Vulcan's Chairman and Chief Executive Officer Tom Hill.  "Vulcan remains well positioned for long-term growth and we look forward to continuing to seek opportunities to further enhance shareholder value."