Aggregates Manager Digital Magazine
Issue link: http://read.dmtmag.com/i/756888
AGGREGATES MANAGER / December 2016 9 sity and spent his junior year studying at Trinity College in Dublin. After finishing his undergraduate degree at Duke, he was set to attend law school before making a last-minute change in plans. "It was August. My dad had spent a lot of time making sure I got into a good law school," he says. "I just chickened out. I decided I didn't want to spend the next seven years in a library." Instead, Hill headed back to Dublin to complete his MBA at Trinity College. It was a decision that changed his future: the director of the MBA program there was also a director of CRH, Oldcastle's parent company. Hill was hired fresh out of the program and spent six months in Ireland before being sent to Ogden, Utah, to work as a financial analyst for the company. He was involved in some acquisitions for the company before getting what he calls his first 'real job' in 1983. "They sent me to build a concrete roof tile plant in Katy, Texas," Hill recalls. "They said, 'Go to Texas and build a plant. Here's an American Express card. Good luck.'" Off Hill went. He bought property from a rice farmer and built a team and a plant. "It was a fantastic experience because I was totally on my own," he says. "I realized quickly that you had to have good people around you." The plant did well and was profitable in its first year. Then came the oil crisis of 1985 and 1986. The plant went from running two shifts and struggling to keep pace with demand to a position where Hill was loading trucks. The experience made a lasting impression. "It gave me the ultimate respect for the construction cycle and recognizing that we are in a cyclical business," Hill says. Learning acquisition strategies After Texas, Hill next moved to Albany, N.Y., where he spent a number of years travel- ing extensively and making acquisitions for the company. "CRH had this wonderful cul- ture of cold calling on private companies," he says. The theory was that if they kept in touch with private companies, those companies would turn to them rather than an investment banker when there was a succession or estate issue. Hill moved his way up at CRH, taking over Oldcastle Materials in 1992. Over the next 14 years, it grew from $100 million in sales to $7 billion in sales. "We did 187 acquisitions. It was a lot of fun," Hill shares. "I really got to love the aggregate, asphalt, ready-mix, and paving businesses. I really love the people. The people who are involved in these busi- nesses are people who get up at 5 a.m. and go to work. There is a fantastic work ethic in the industry. "The thing that always amazed me is that you'd give these owners all this money and they'd still show up at 5 a.m. on Monday and go to work because that's what they do," he adds. In 2006, Hill gained responsibility for all of Oldcastle, across its myriad divisions, and ran it for two years, but in 2008, his career path took an unexpected twist. "I lost out on a suc- cession change for the C EO job back in Dublin," he says without rancor. At that point, he had a wife and two young daughters, and he had decisions to make. "CRH and Oldcastle are fantastic businesses, but the travel was wearing me out," he recalls. "We were willing to move to Dublin, but traveling there every month was too much." Enough was enough. "I found out on a Wednesday that I didn't get the CEO job. On Friday, I'd resigned. On Monday, I was back in the United States," he says. Within 30 days, he and his wife, Jane, had sold their home and moved to their summer home in Wyoming. Starting over with Summit Once back in Wyoming, Hill considered his options for the future. That's when a friend from Duke, Ted Gardner, suggested that Hill leverage the skills he learned at Oldcastle, but put them to work for the two of them. So, in 2008, the idea for Summit Materials was born. "My wife came up with the name," Hill explains. "We were trying to figure out what to call it. I was thinking of Newcastle, which was vetoed. We were sitting on our back deck and looking at the mountains, and she said, 'What about Summit?' I said, 'Okay, that works.'" Gardner, Hill, and a third friend threw money into a pot, got an office, and started raising capital and exploring potential acquisitions. "We soon realized that there was a big opportunity out there in that a lot of the large companies had done big deals and had really been crippled by the financial cri- sis," he says. "There weren't a lot of people out there doing acquisitions, so we started calling on private equity firms. Via a real fluke, we got hooked up with Blackstone Group, the largest private equity firm in the world — which never does startups. We happened to hit the right guy at the right time. They gave us a $750 million equity commitment, and we were off to the races." In the aggregate and heavy-building sector, Hill says that there are always com- panies that have to sell for some reason, whether it's due to a succession issue, age, health, or other factors. The unique opportunity for Summit Materials was that no one else was playing in that space at that time. And the bonus? Hill had decades of history in the market and the contacts to go with it. "We did our very first deal in September 2009 of the Hamm Co., a very fine aggre- gates and asphalt business located in Perry, Kan.," Hill explains. "Having been in this business for most of my life, most of our acquisitions have been relationship based. I knew Jason Kilgore, who we acquired in Utah, for 15 years. We acquired the Hinkle business in Kentucky. I had known Henry and Tom Hinkle for decades." Those relationships remain strong after he completes an acquisition. "They said, 'Go to Texas and build a plant. Here's an American Express card. Good luck,'" —Tom Hill