BIRMINGHAM, Ala. - Vulcan Materials Company (NYSE: VMC), the nation's largest producer of construction aggregates, announced today that it has entered into a definitive agreement to sell the Company's cement and concrete businesses in the Florida area to Cementos Argos for gross cash proceeds of $720 million. Vulcan is retaining all of its aggregates operations in Florida. As part of the transaction, the Company has entered into a supply agreement to continue to provide aggregates to the divested concrete facilities, at market prices, for a period of 20 years. The transaction, which is subject to regulatory approval under the Hart-Scott-Rodino Act and customary closing conditions, is expected to close in the first quarter of 2014.

Concurrent with this announcement, the Company is initiating a tender offer to purchase $500 million of outstanding debt. A separate announcement released today outlines the details of this tender offer.

In addition, the Company exercised an option in December to purchase land containing 136 million tons of aggregates reserves in Southern California for $117 million. The Company previously operated this quarry under a lease which was scheduled to expire in 2017. This land purchase increases pretax earnings by eliminating a $7 million per year lease payment and, via a deferred like-kind exchange, allows the Company to defer approximately $37 million of cash taxes referable to the sale of land that is part of the cement and concrete assets transaction.

The completion of the asset sale to Cementos Argos and related restructuring and other transaction-related expenses will result in a pretax gain of approximately $210 million, or $1.00 per diluted share. The $500 million reduction in long-term debt via the tender offer will reduce annual pretax interest expense by approximately $33 million and will increase annual net earnings by approximately $0.16 per diluted share. The Company expects to record a one-time charge of approximately $0.37 per diluted share associated with the premiums paid above par value and the acceleration of previously deferred finance charges.

"Divesting these non-core cement and concrete assets, at a full and fair valuation, allows us to further enhance our financial strength and strategic focus as the leading aggregates producer in the fastest-growing regions and urban markets of the United States," said Don James , Chairman and Chief Executive Officer.

"Since announcing our asset sale plan in February 2012, we have raised more than $1 billion in proceeds from the sale of non-core assets, including today's transaction and the future production sale agreements announced last year. With this capital, total debt will have been reduced by almost $800 million, including the tender offer announced today, and we will have invested more than $240 million to acquire aggregates quarries and reserves in California, Georgia, Texas and Virginia. We remain committed to building shareholder value through the execution of our core aggregates strategy."

The assets being acquired by Cementos Argos are located in Florida and south Georgia, and include Vulcan's Newberry, Florida cement plant, Tampa and Port Manatee cement terminals and grinding facilities, 69 ready-mixed concrete sites and 13 concrete block and building material sites. Combined, these assets generated approximately $153 million in net sales and a loss of $1 million in EBITDA for the 9 month period ended September 30, 2013. Vulcan is retaining its cement segment's ground calcium operations.

Reconciliation of Non-GAAP Financial Measures

Generally Accepted Accounting Principles (GAAP) does not define "Earnings before Interest, Taxes, Depreciation and Amortization" (EBITDA). Thus, EBITDA should not be considered as an alternative to earnings measures defined by GAAP. We present this metric for the convenience of investment professionals and for shareholders who need to understand the metrics we use to assess performance. We use EBITDA to assess the operating performance of our various business units and the consolidated company. We do not use this metric as a measure to allocate resources. EBITDA adds back depreciation and amortization of $27 million to an operating loss of $28 million for an EBITDA loss of $1 million for the nine month period ended September 30, 2013.