Arcosa, Inc. announced the completion of its previously announced acquisition of Stavola's construction materials business for $1.2 billion on October 1, 2024. Stavola is an aggregates-led, vertically integrated company primarily serving the New York-New Jersey Metropolitan Statistical Area through its network of five hard rock natural aggregates quarries, twelve asphalt plants, and three recycled aggregates sites.
For the twelve months ended June 30, 2024, Stavola generated revenues of $283 million and Adjusted EBITDA of $100 million, representing a 35% Adjusted EBITDA Margin. The aggregates business contributed 56% to Stavola’s LTM Adjusted EBITDA, and the transaction is expected to create tax benefits for Arcosa with a net present value of approximately $125 million.
The acquisition was funded with a $600 million 6.875% Senior Note issuance due 2032 and a $700 million variable-rate senior secured Term Loan B Facility due 2031. Concurrently, Arcosa completed the sale of its steel components business on August 16, 2024, which was deemed non-core and cyclical. Proforma for these transactions, the Construction Products segment is expected to represent nearly two-thirds of Arcosa's Adjusted EBITDA, and the overall Adjusted EBITDA Margin is projected to increase by more than 200 basis points.
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