Crime runs deep in the world of construction materials, and the latest case involves one of the industry’s biggest players. Vulcan Materials Company, a New Jersey corporation headquartered in Birmingham, Alabama, has agreed to divest 17 aggregate facilities in Tennessee and Virginia to settle antitrust charges.
The company, one of the largest producers of coarse aggregate and construction materials in the United States, with facilities in 20 states and the District of Columbia, was accused of attempting to eliminate competition in the Knoxville, Tennessee, Tri-Cities, Tennessee, and Abingdon, Virginia areas. According to the complaint, Vulcan and Aggregates USA produce and sell coarse aggregate, a type of crushed stone, to customers such as the Tennessee and Virginia Departments of Transportation, highway construction contractors, and suppliers of asphalt concrete and ready mix concrete.
Without relying on a regulatory behavioral decree, the divestitures will ensure that customers, and ultimately taxpayers, in Tennessee and Virginia continue to benefit from robust competition and competitive prices, said Assistant Attorney General Makan Delrahim of the Antitrust Division. The acquisition, as originally proposed, would have eliminated one of the two suppliers of coarse aggregate in parts of east Tennessee and southwest Virginia.
Under the terms of the proposed settlement, Vulcan must divest Aggregates USA’s 13 active quarries and yards, and four inactive quarries, in the Knoxville, Tennessee, Tri-Cities, Tennessee, and Abingdon, Virginia areas to Blue Water Industries, or an alternate acquirer approved by the United States. The department said that the divestitures will remedy the acquisition’s anticompetitive effects by providing the acquirer with the quarries, including substantial reserves, and other assets necessary to compete in these local markets.
Vulcan, a New Jersey corporation headquartered in Birmingham, Alabama, is one of the largest producers of coarse aggregate and construction materials in the United States, with facilities in 20 states and the District of Columbia. In 2016, Vulcan’s revenues were approximately $3.5 billion.
The proposed settlement, along with the department’s competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement within 60 days of its publication to Maribeth Petrizzi, Chief, Defense, Industrials, and Aerospace Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 8700, Washington, D.C. 20530.
In 2016, Aggregates USA’s revenues were approximately $124 million. SPO Partners, a Delaware limited partnership headquartered in Mill Valley, California, acquired Aggregates USA in 2010 and has more than $7 billion in assets under management.
The exact outcome of this case is yet to be determined, but one thing is clear: the world of construction materials is a complex and competitive landscape where companies must navigate the fine line between business and crime.
Vulcan Materials Company, Antitrust Violation, Tennessee 2023
Key Facts
- State: Tennessee
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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