The 'Namgis First Nation is optimistic that a new American partner and improved U.S. economic conditions will produce financial benefits from the nation’s Orca Sand and Gravel quarry.
U.S. Concrete has acquired Polaris Materials Corporation, which launched shipments to California from the new quarry a decade ago, hauled out on a huge Panamax bulk freighter heading south to San Francisco.
Polaris owns Orca Sand and Gravel, located on traditional First Nations lands near Port McNeill. The 'Namgis First Nation holds a 12-per-cent ownership stake in Orca.
Hopes were high for the quarry’s economic success, with initial predictions of $5 million to $6 million per year to flow to the band. But the global economic crisis starting in 2008 hit its bottom line.
'Namgis Chief Don Svanvik said Friday, “we haven’t really made any money since then,” but added he is “very optimistic” that the partnership in the mine will produce financial benefits in the near future.
U.S. Concrete is a major player in the aggregate business. Last year, the company sold 8.1 million cubic yards of ready-mixed concrete and 5.6 million tons of aggregates. It has 200 plants producing ready-mixed concrete and aggregates in the U.S.
The Texas-based company determined that buying Polaris was good for them and “if it is good for them, it is good for us,” Svanvik said.
'Namgis and Kwakiutl band members have found work at the quarry. Svanvik said his nephew has worked at the mine since it opened.
Polaris also owns two terminals, in Richmond and Long Beach, California, which receive Orca materials for major infrastructure projects in the state.
The sale of Polaris to U.S. Concrete has closed, giving the U.S. firm 100 per cent of all shares. Polaris common shares were acquired by U.S. Concrete for $3.40 per share. U.S. Concrete paid $300 million to former Polaris shareholders. Another $8.4 million was paid to option holders and deferred shareholders.
Polaris has been delisted from the Toronto Stock Exchange now that the sale has gone through.
“This acquisition will enable us to self-supply a majority of our current Northern California aggregate requirements and to further expand our footprint into other supply constrained markets along the West Coast, including Southern California,” William Sandbrook, U.S. Concrete’s president and CEO, said in a statement.
“We look forward to working with our First Nations partners in the Orca quarry, the Kwakiutl Band and the 'Namgis First Nation, as the strength of those relationships are a vital part of the success of the business, today and for the future,” he said.
Polaris Materials’ annual report for the year ending Dec. 31 2016 said it expected improved revenue, prices and margins in 2017. “Markets in California continue to be robust and there have been a number of developments that provide us with confidence that activity state-wide will continue for the next several years.”
