Martin Marietta Bids for Vulcan Materials

One of Kennesaw’s biggest corporate residents is facing a hostile takeover bid.

says its board is weighing an all-stock offer from smaller competitor Martin Marietta Materials to merge the suppliers of stone, gravel and other construction materials.

The offer of a half-share of Martin Marietta stock for every share of Vulcan stock was worth about $4.8 billion based on the share prices at the time Raleigh, NC-based Martin Marietta announced the offer.

Vulcan is based in Birmingham, AL, and has its Southeast headquarters in Sandy Springs. .

The company urged shareholders to wait up to two weeks for the Vulcan board to recommend a response to the stock offer.

The shares prices of both companies rose Monday on the news of the bid. Vulcan closed up more than 15 percent at $38.70; Martin Marietta rose 1.7 percent to $74.61.

"We are bringing our proposal directly to Vulcan's shareholders after Vulcan ceased participating in private discussions toward a negotiated transaction, which commenced over a year and a half ago," Martin Marietta CEO Ward Nye said in a company news release.

Nye said the deal would reward Vulcan shareholders with an annual dividend at 20 times the rate of what they get now.

Martin Marietta has higher profit margins than Vulcan and says it could cut $250 million a year in costs if it ran its rival, The New York Times reported.

The Wall Street Journal said the merger proposal comes in anticipation of a rebound in the construction industry.

The has already seen the signs of that rebound in . The higher prices led the Board of Education last week to to take advantage of a recession-driven dip in prices.