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Hdpe Pipe Giant's Rigid Bet

An independent concrete pipe and precast operator we visited in April 2009 seemed poised to play a greater role in the Carolinas and markets north, where

DON MARSH, EDITOR This email address is being protected from spambots. You need JavaScript enabled to view it.

An independent concrete pipe and precast operator we visited in April 2009 seemed poised to play a greater role in the Carolinas and markets north, where Oldcastle, Hanson and Rinker-stenciled product is common. As of April 2010, Foltz Concrete Pipe Co. LLC, is no longer independent. It now looks poised to test a sales, engineering, and distribution model at a company that is to high density polyethyene pipe (HDPE) what Oldcastle, Hanson and Rinker are to concrete pipe and drainage structures.

The world's largest HDPE pipe producer, Hilliard, Ohio-based Advanced Drainage Systems Inc., closed on Foltz Concrete Pipe last month. ADS Chairman Joe Chlapaty indicated that the Winston-Salem, N.C., business would be the first of many, similar acquisitions that will take place as this year unfolds ÷ Foltz is yet another step ADS is taking to meet the needs of the storm drain and sanitary sewer markets. The unique ability to package multiple products for the same job-site, including plastic pipe, concrete pipe, [and] precast structures, can be of tremendous value to the customer.

ADS has 46 domestic and international pipe plants and 22 distribution centers, offering the flagship N-12 pipe and proprietary StormTech, Nyoplast and BaySaver drainage structures and vessels. Beyond packaged shipping capability for a concrete and HDPE inventory, the company has a nationwide team of engineering and sales professionals who provide consultants, agencies, distribution partners and contractors drainage and sanitary sewer project solutions. The Foltz Concrete arrival might compel ADS staff to avoid claims of HDPE pipe's shipping and handling economies versus concrete pipe. Where appropriate, they can acknowledge the performance and ease of construction benefits wet or dry cast concrete structures offer over any drainage alternatives.

Thanks to 2008-09 capital investments resulting in a full-plant overhaul, Foltz Concrete is a low-cost producer of 15- to 72-in.-diameter pipe, plus precast catch basins and other drainage structures. ADS has been positioned in the economic downturn to establish strategic alliances with best-in-class companies like Foltz, Joe Chlapaty observes, adding that we look for partners who share in our vision, along with products and technologies that improve effectiveness in all aspects of drainage performance. This acquisition is the kind of bold move our customers have come to expect and the ideal fit with our goals for growing the industry.

If Foltz is the first of similar ADS acquisitions this year, how many other independent concrete pipe or precast producers are looking to sell, or finding the current industry slowdown more than they can weather? Assuming some deep pockets coupled with a firm belief in jointly promoting rigid and flexible drainage products on a previously untested scale, one trophy concrete pipe and precast property comes to mind. It would have been a natural fit for CRH/Oldcastle, who in fall 2007 was discussing several deals with Cemex Û by then weighing what Rinker parts were long-term holdings.