Reports confirm that Construction Partners, Inc. (CPI) has completed the acquisition of two businesses in Florida for the aggregate buying price of nearly $19 million, paid using cash on hand entirely. For both the acquired assets, CPI intends to make customary capital improvements, although does not expect these expenditures to be material.
A liquid asphalt terminal situated in Florida’s Panama City is one of the acquired businesses, a CPI news release has stated. The purchase is representative of the vertical integration strategy of the company, offering the ability to supply liquid asphalt to its numerous hot mix asphalt plants in the company’s southern region footprint, including Alabama, Florida and Georgia.
The terminal would allegedly be used by CPI for receiving, storing, and processing liquid asphalt for distribution to its hot mix facilities. The company forecasts that the terminal would serve its own plants primarily, with minimal sale to third parties.
CPI informed that the other asset it has bought is an Okeechobee, Florida-based hot mix asphalt and ready-mixed concrete business. The deal would allow CPI to cater to new markets in south central Florida with the help of an extended geographic footprint in the state.
CEO and President of CPI, Charles E. Owens was quoted saying that the two recent acquisitions are consistent with the company’s strategies of vertical integration as well as expanding service market in southeastern U.S., particularly in high-growth areas. The firm will expedite its integration efforts and is expecting service and operations-related synergies to considerably benefit its operational results in fiscal 2019, he added.
For the uninitiated, Construction Partners, Inc. is a vertically integrated civil infrastructure firm that operates across five states in southeastern U.S, with 9 aggregate facilities, 31 hot mix plants and a liquid asphalt terminal. Most of the company’s projects seem to be related to maintenance, and its publicly funded projects include bridges, airport runways, interstate highways and local and state roadways.