A. Lee Graham
Reporter
Eagle Materials Inc. has entered into an agreement to acquire CRS Proppants LLC and its subsidiaries, including Great Northern Sand LLC, which supplies northern-white frac-sand to the energy industry.
The transaction would align well with Eagle Materials’ growth strategy, according to the Dallas firm. It described CRS Proppants’ operations as complementary with Eagle’s existing frac-sand operations.
CRS Proppants operations include a northern-white frac-sand mine and processing facility in Wisconsin, and Union Pacific rail-based trans-load network from the mine into the Permian and other target basins.
The approximate $225 million cash purchase price is subject to adjustments for working capital and other items, and would be funded by operating cash flow and borrowings under Eagle’s bank credit facility.
The acquisition would roughly double Eagle’s frac-sand production capacity and expand Eagle’s frac-sand reserves.
“The acquisition represents another key step in Eagle’s growth strategy for the frac-sand business,” said Steven Rowley, Eagle Materials president and CEO in a news release.
“This acquisition will enable us to immediately serve the Permian basin, in particular, with increased production, while creating synergies with our other operations in Texas that are currently serving the Eagle Ford with sand from our Illinois mine,” Rowley said.
Under the definitive agreement, the acquisition is subject to certain customary conditions, including clearance under the Hart-Scott-Rodino Act. The company currently expects that the acquisition will close during Eagle’s third fiscal quarter of the current year. More information is available at www.eaglematerials.com.