Nearly 100 years ago, General Shale was born through a merger of the Johnson City Shale Brick Company and the Kingsport Brick Corporation, setting the stage for the company to become a leading brick producer in the United States.
On Tuesday night, General Shale CEO Charles Smith discussed how the recent acquisition of Meridian Brick has positioned his company to thrive for many years to come during a celebration at the company’s Johnson City headquarters.
“It expands our geographic footprint and gives us a presence in Texas and Oklahoma,” Smith said. “Twenty-seven percent of all brick in the U.S. is sold in Texas, so it’s key for us and our growth strategy. It also expands us into the clay brick business in Canada. It gives us an opportunity to find synergies with our existing businesses in Canada and grow from there.”
General Shale finalized the acquisition of Meridian earlier this month when the U.S. Department of justice granted its approval of the transaction on the condition General Shale and Meridian Brick to divest several assets used in the manufacture and sale of residential brick. The move was made to preserve competition in the southern and midwestern United States following a lawsuit by the Justice Department’s Antitrust Division aimed at blocking the deal.
The antitrust division, however, filed a proposed settlement concurrent with the civil lawsuit to resolve the alleged competitive harm. Under the terms of the proposed settlement, the parties were required to 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.”
Despite those requirements, Smith said the move was a major step forward for General Shale.
“Quite simply, we’re now North America’s largest producer of clay brick,” he said. “It’s all about our growth strategy and being sustainable.”