Blackstone, Others Back $780m Building Venture

NEW YORK (Reuters) – Private equity firm Blackstone Group (BX.N) and other backers are investing up to $780 million in a newly formed company created to acquire building materials businesses, the investors said on Tuesday.

The new company, named Summit Materials, will be led by Tom Hill, the former CEO of Oldcastle Inc, the U.S. division of Ireland-based building material group CRH (CRH.I).

Other partners include investment group Silverhawk Capital Partners and Charles Goodyear, former CEO of BHP Billiton (BLT.L).

“Over the next 18-24 months we envision making a number of acquisitions,” Neil Simpkins, senior managing director at Blackstone, told Reuters. He said the group is seriously looking at a pipeline of about 10 transactions.

Simpkins said likely acquisition targets are privately held businesses in several regions around the country, and assets that large multinational building product companies may be selling to reduce debt.

He said in a statement announcing the deal that the U.S. heavy-side building materials sector represents significant opportunities for growth.

Summit Materials said its first acquisition is Hamm, Inc, a privately held aggregates, landfill, asphalt and construction company in Perry, Kansas. That deal is a platform for future growth and development in the American Midwest, the firm said.

(Reporting by Megan Davies; Editing by Richard Chang)