Colombian Grupo Argos proposes merger of cement unit with Summit Materials

Grupo Argos, a Colombian industrial conglomerate that covers energy and construction materials, approached US cement manufacturer Summit Materials Inc for a merger, people familiar with the matter said Thursday.

Such an agreement would reinforce the presence of Grupo Argos in the United States and illustrate how construction materials companies in emerging markets seek to impose themselves in more mature economies.

Grupo Argos sees value in the combination of Cementos Argos SA, one of its subsidiaries, with Summit Materials, the sources said. However, there is no certainty that the US company will negotiate an agreement, they added.

The sources asked not to be identified because the matter is confidential. Grupo Argos and Summit Materials did not respond immediately to requests for comments.

Argos, controlled 35.4% by the GrupoSURA holding, announced in March that it will invest some 2.6 trillion pesos (US $795 million) this year in its power, concessions and cement subsidiaries.

After hearing this news, the action of Summit Materials rose about 16.8% on the New York Stock Exchange.

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