*DJ Justice Department Requires Divestiture for General Shale to Proceed with Acquisition of Meridian Brick

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Press Release: Justice Department Requires Divestiture for General Shale to Proceed with Acquisition of Meridian Brick

The United States Department of Justice

FOR IMMEDIATE RELEASE

October 1, 2021

WWW.JUSTICE.GOV/NEWS

Justice Department Requires Divestiture for General Shale to Proceed with Acquisition of Meridian Brick

Divestiture Will Preserve Competition for the Manufacture and Sale of Residential Brick in the Southern and Midwestern United States

WASHINGTON - The Department of Justice announced today that it will require General Shale Brick Inc. (General Shale) and Meridian Brick LLC (Meridian), two of the largest suppliers of residential brick in the United States, to divest several assets used in the manufacture and sale of residential brick to preserve competition for these products in the southern and midwestern United States.

The Justice Department's Antitrust Division filed a civil antitrust lawsuit in the U.S. District Court for the District of Columbia to block the proposed transaction. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive harm alleged in the lawsuit. Under the terms of the proposed settlement, the parties must divest three manufacturing facilities, 14 distribution yards and showrooms, and six mines for extracting input materials used in the manufacture of residential brick to RemSom LLC (RemSom) or an alternative acquirer approved by the United States.

"Residential brick is an essential building block in American home construction," said Acting Assistant Attorney General Richard A. Powers of the Justice Department's Antitrust Division. "As originally proposed, the transaction would have led to higher priced and lower quality residential brick, making it more expensive for millions of Americans to build and purchase homes. The settlement preserves competition for the manufacture and sale of residential brick to the benefit of American homebuilders and homebuyers."

According to the complaint, General Shale and Meridian are two of the top suppliers of residential brick in eight separate local markets in six states (Tennessee, Alabama, Kentucky, Indiana, Michigan and Ohio). Without the required divestiture, the proposed transaction would have eliminated the substantial competition that currently exists between General Shale and Meridian in those markets.

General Shale is headquartered in Johnson City, Tennessee, and is a North American subsidiary of Wienerberger AG. General Shale is a leading U.S. producer of construction materials, such as brick, stone and concrete block products. Wienerberger AG's North American business generated approximately $370 million in revenues in 2020, 78% of which came from brick sales.

Meridian was formed as a joint venture in 2016 by its parent companies Boral Limited and LSF9 Stardust Super Holdings L.P. Meridian, headquartered in Alpharetta, Georgia, is the largest residential brick manufacturer in the United States. Meridian generated over $400 million in revenues in the fiscal year 2020, which was primarily derived from brick sales.

RemSom is a private investment firm that became the majority shareholder of US Brick LLC (US Brick), formerly known as Carolina Brick, in 2020. US Brick is a commercial and residential brick manufacturer that sells brick in 30 different states. US Brick is headquartered in Columbia, South Carolina.

As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Jay Owen, Acting Chief, Defense, Industrials, and Aerospace Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street NW, Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may enter the final judgment upon finding it is in the public interest.

The claims resolved by the settlement are allegations only and there has been no determination of liability.

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ATR

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October 01, 2021 10:47 ET (14:47 GMT)