UPDATE 1-Martin Marietta must divest as part of Texas Industries deal
(Adds details of settlement, share prices)
WASHINGTON, June 26 (Reuters) - Martin Marietta Materials Inc must divest an Oklahoma quarry and two Texas rail yards in order to proceed with its proposed $2.7 billion acquisition of Texas Industries Inc, the U.S. Department of Justice said on Thursday.
Without the divestiture, the proposed acquisition was likely to result in higher prices for purchasers of aggregate in parts of the Dallas metropolitan area because of a dearth of competition, the DOJ said.
Aggregate, a crushed stone produced at quarries or mines, is used in a variety of applications, such as road construction, and for the production of ready-to-mix concrete and asphalt.
The DOJ's anti-trust division and the state of Texas on Thursday filed a civil lawsuit to block the proposed transaction, and at the same time filed a proposed settlement to resolve competitive concerns.
Among the beneficiaries of the actions will be the Texas Department of Transportation, for whom Martin Marietta and Texas Industries are two of the only three suppliers of aggregate for road building and other infrastructure projects.
Under the proposed consent decree, North Carolina-based Martin Marietta must divest its North Troy aggregate quarry in Mill Creek, Oklahoma, and rail yards in Dallas and Frisco, Texas, to approved buyers.
In midday U.S. trading Martin Marietta was down 0.7 percent at $130.00 per share and Texas Industries was down 0.9 percent at $90.800. (Reporting by Ros Krasny; Edited by Susan Heavey and Bill Trott)