Maas Group may tempt building materials operators

Quarries are difficult assets to replicate, and are most valuable when they are close to populated areas.

The period of consolidation in the building materials industry could be set to continue, with some questioning whether one of the major participants in the industry makes a play for the $1.6bn listed Maas Group.

Maas listed in 2020 with a market value of $530m and is considered as having an eclectic mix of assets. It embarked on mergers and acquisitions, buying Melbourne East quarries and the concrete business Economix last financial year.

But the attraction to one of the larger building materials players is that it has been scooping up regional quarries around the country, and once it gets big enough, the play could be for one of the larger industry players to take it out.

Quarries are difficult assets to replicate, and are most valuable when they are close to populated areas. The economics of using them frequently do not work when too distant from construction activity.

Among the buyers for Maas Group could be CRH, one of the largest players in the industry that recently bought cement company AdBri for $2.1bn.

Cement Australia, which is joint venture between Holcim and Heidelberg, could also show some interest.

Or another possibility is Saint Gobain, the buyer of CSR this year for $4.3bn, also buys Maas.

Seven Group, the owner of the country’s largest building materials provider Boral, may have some interest, but only when the company reduces its debt which remains a key focus.

Maas Group, founded in 2002, describes itself as a diversified industrial group and its share price has rallied in the past year.

For the year to June, it generated $73m in net profit, up 12 per cent on the previous corresponding period, and is guiding the market to EBITDA for the 2025 financial year of between $215m and $245m.

It operates in commercial and residential real estate, building materials, civil construction and hire and manufacturing and equipment sales.