Cornillie Concrete merges with U.S. Concrete
TRAVERSE CITY – Cornillie Concrete, a leading ready-mixed concrete supplier in northwestern Michigan, with a Detroit office, has merged with U.S. Concrete Inc., a publicly traded (NASDAQ-RMIX) company, with headquarters in Houston.
Rick Deneweth, co-owner and president, says the move was prompted by the realization that consolidation is coming to the concrete construction industry. “This has been a major trend in our business for five years now,” he noted. “We’re impressed with U.S. Concrete’s management and their business philosophy. We like the way they operate. In turn, they like the way we manage our company and they’re impressed with the quality and experience of our staff. It proved to be a natural fit, and we’re very excited about it.”
Terms of the merger were not disclosed. No major changes will result from the transaction, he emphasized. Even the name will stay the same.
“It’s such a unique concept. We gain all the benefits of a large corporation, but still run our own operation and retain our identity. It’s a great opportunity,” Deneweth observed.
As for the employees, he says, “We wouldn’t be where we are today without them.”
Putting his money where his mouth is, Deneweth gave every worker a bonus when the merger was announced.
“Every employee received a check–which was fun for me to hand out–based on their years of service to the company. Even those who just started just a couple of weeks ago,” he said.
The firm has four locations: Detroit, Traverse City, Bear Lake (near Manistee) and Petoskey. Last year’s sales were over $10 million.
Founded in 1998 with five ready-mixed producers in two states and the District of Columbia, U.S. Concrete Inc. now has 45 ready-mixed plants in markets located throughout the United States. In 1999, the year it went public, it had 3.8 million cubic yards of production and revenues of over $240 million.
In a trade magazine article last fall, Gene Martineau, president and CEO, noted that U.S. Concrete’s strategy was to locate well-run ready-mixed manufacturers in strong markets.
“The concrete business is moving at a record clip and the outlook is very strong,” he said. “We contend that opportunities to establish relationships is best exploited by a public company, whose leverage can be used to implement cost-saving technologies and best practices nationally, while enabling local managers to better focus on their markets.”
The Cornillie Concrete merger represents the second transaction in Michigan for U.S. Concrete. Last November, it merged with Fendt, a Novi area-based ready-mixed producer.
Founded in the Detroit area in 1904, Cornillie Concrete was purchased in 1986 by Joseph Cornillie, grandson of the founder, along with partner and co-owner Deneweth.
Cornillie continues to head the firm’s Detroit operations. In 1990, Deneweth moved to Traverse City when the company purchased the former Peninsula Ready-Mix Co. Since then, Cornillie has made significant improvements to its 22-acre Cass Road site, while also expanding west to Bear Lake in ’96, and north to the Petoskey/Harbor Springs area in ’97.
Deneweth attributes the company’s position to its technological sophistication and highly-trained and experienced staff.
Cornillie and Deneweth bring a solid mix of financial, legal and business experience to the ready-mixed concrete industry.
The partners were accounting majors in college. Cornillie is a Michigan State University Business School graduate, while Deneweth graduated from John Carroll University, Cleveland, Ohio, with an accounting degree. Both later became certified public accountants.
Deneweth is also a Detroit College of Law School graduate, and was admitted to the Michigan Bar in 1986. Both his undergraduate and law school degrees were earned with cum laude honors.
Employment with major downstate accounting firms, as well as banking experience and business consulting prior to their acquisition of Cornillie, have given the partners invaluable experience.
The merger with a fast-growing national company like U.S. Concrete Products will give Cornillie the opportunity to accelerate its already ambitious growth plans, predicts Deneweth.
“This exciting new affiliation will allow us to operate on a decentralized basis, yet gives us significant resources for expansion,” he said. “It’s the best of both worlds and we’re excited about it. Quite frankly, it provides us an opportunity to expand far beyond what we thought possible.” BIZNEWS