Jamestown Suit-Kote plant to be sold
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The Suit-Kote operation in Jamestown is up for sale as part of a plan to allow Suit-Kote to merge with Colas, a global road construction and maintenance company based in Paris, France and a subsidiary of the Bouygues Group.
Colas’ August stock purchase agreement with Suit-Kote, a Cortland-based company with a plant in Jamestown, has drawn the attention of the New York and Pennsylvania attorneys general.
Colas and Suit-Kote are two of the leading producers of asphalt emulsions and pavement preservation services in the northeast, including Pennsylvania. They use and sell asphalt emulsions to complete their own projects and sell and distribute these products to external customers. A proposed merger of the company, the attorneys general for New York and Pennsylvania say, would significantly increase concentration in already highly concentrated markets.
Asphalt emulsions are products made from bitumen or liquid asphalt, water and emulsifiers that are generally used in pavement preservation.
On Friday, David Sunday, Pennsylvania attorney general, asked a federal district court in Pennsylvania to rule the merger of Suit-Kote and Colas Inc. violates Section 7 of the federal Clayton Act and restrain Colas from carrying out the acquisition or any other agreement by which Colas will merge or acquire Suit-Kote. Colas purchased all of the outstanding shares of Suit-Kote in August.
The companies -- previously competitors -- produce and sell asphalt products and services in Pennsylvania to governmental entities (including PennDOT and municipalities) and commercial purchasers. The companies also offer pavement preservation services, such as chip sealing, micro-surfacing, milling, and other similar processes that maintain pavements including roads.
The Pennsylvania Attorney General's action prompted the companies to agree to divest four facilities, including one in Bloomsburg, where the companies also agreed to commit $6.5 million to build out that facility with an emulsion mill, storage for asphalt emulsions, and pavement preservation equipment. Doing so will allow the merger to move forward.
"This is a very important action taken by my Antitrust Team that will ensure a fair marketplace is maintained for these products and services," Attorney General Sunday said. "It will protect critical roadway infrastructure in central and western Pennsylvania and preserve the government funds that pay for it. The Antitrust Team engages in complicated work to make sure transactions between companies do not harm Pennsylvania, its economy, and its consumers."
The Pennsylvania Attorney General’s office wrote in its court filing late last week that Colas’ acquisition of Suit-Kote’s asphalt emulsions manufacturing and pavement preservation services will give Colas control over the supply of asphalt sold to the state of Pennsylvania and access to asphalt and pavement preservation that Pennsylvania municipalities need to complete road maintenance projects.
In order to resolve the Commonwealth’s concerns with their proposed transaction and preserve competition in the affected markets, Colas and Suit-Kote have agreed to divest four facilities to a qualified buyer: three Suit-Kote facilities in New York (Belmont, Buffalo and Jamestown) and one Colas facility in Pennsylvania (Bloomsburg). They have also agreed to invest up to $6.5 million to build out the Bloomsburg facility with an emulsion mill, adequate storage for asphalt emulsions, and pavement preservation equipment. Additionally, they have agreed to invest up to $3.5 million to build out the Belmont facility with pavement preservation equipment.
"No one should be forced to pay unfair prices for safe, well-maintained roads," said New York Attorney General Letitia James. "Protecting competition in this industry will ensure New Yorkers' tax dollars are spent fairly and asphalt companies will continue to provide high-quality services to our towns and counties."
Suit-Kote specializes in the distribution of liquid asphalt, in the manufacture of emulsion mixes, and in road construction and pavement preservation across multiple states in the northeastern United States. With over 750 employees, Suit-Kote generates approximately 500 million US dollars in revenue annually.
This acquisition is in line with the Colas strategy of pursuing its international growth in targeted areas (Northern Europe, United States, Germany and Australia). It will strengthen Colas’s positions in the industries of this highpotential country. In particular, it will help Colas Group to develop its business on the bitumen distribution market in the northeastern United States, according to a company news release in August.
“Suit-Kote’s regional roots, its expertise in bitumen processing and its model combining production, logistics and implementation will provide lasting support for our development in the United States”, says John Harrington, Colas executive vice president for the United States.
Colas has been operating in North America for over 60 years. It employs 13,500 people and generated 28% of its revenue there at the end of 2024, making it the Group’s second-largest market after France.