Astec Fortifies Road-Building Arm with $67.5M CWMF Acquisition

CHATTANOOGA, TN – January 02, 2026 – Astec Industries, a major manufacturer of equipment for road building and aggregate processing, today announced it has finalized the acquisition of CWMF, LLC, a respected manufacturer of asphalt plant equipment. The $67.5 million all-cash deal marks a significant strategic move for Astec, aimed at strengthening its market position, expanding its manufacturing capacity, and delivering increased value to shareholders.

Astec leadership anticipates the acquisition will be immediately beneficial to the company’s financial health, projecting increases in gross profit margins, adjusted EBITDA margins, and overall earnings per share. The purchase of the Minnesota-based CWMF is expected to generate tangible synergies within the first year of integration.

A Strategic Play for Market Dominance

The acquisition seamlessly integrates CWMF into Astec’s Infrastructure Solutions segment, which is the core of its road-building and concrete production operations. CWMF brings a robust portfolio of portable and stationary asphalt plant equipment, including high-demand products like drum mixers, baghouses, and advanced reclaimed asphalt product (RAP) crushers such as the 'Honey Badger' and 'RAP Boss'.

For over three decades, CWMF has carved out a distinct niche in the industry by focusing on durable, custom-built equipment tailored to individual customer needs. This emphasis on American-made craftsmanship and practical design has fostered exceptional customer loyalty, with reports indicating that 96% of its equipment buyers become repeat customers. This established client base is heavily concentrated in the Midwest, South-Central, and Great Lakes regions of the United States—areas where Astec can now deepen its market penetration.

“We are pleased to welcome the CWMF employees into the Astec family,” said Jaco van der Merwe, Astec President and CEO, in a statement. “CWMF has strong customer relationships... and is an excellent cultural fit with Astec. The addition enhances our ability to serve our customers, increases capacity in our Infrastructure Solutions segment and adds further growth opportunities to generate enhanced shareholder value.”

Paving the Path to Profitability

Financially, the acquisition is structured to be immediately accretive. CWMF generates approximately $50 million in annual revenue, which will now contribute to Astec's top line. The $67.5 million purchase price, handled on a cash-free, debt-free basis, aligns with what Astec describes as its “disciplined growth strategy.”

This strategy is not new. The CWMF deal follows a pattern of strategic acquisitions, including the $245 million purchase of TerraSource Holdings, LLC in July 2025. Like the CWMF acquisition, the TerraSource deal was also projected to boost margins and earnings, largely by leveraging a strong aftermarket parts and service business. This consistent M&A approach demonstrates a clear focus on acquiring companies that offer both market expansion and strong financial returns.

Brian Harris, Astec’s Chief Financial Officer, commented on the financial discipline behind the move. “The addition of CWMF is consistent with our disciplined growth strategy,” he noted. “With annual revenue of approximately $50 million, we fully expect CWMF will enhance our earnings and be accretive while we will stay within our previously disclosed, disciplined leverage range.” The company projects its proforma net leverage ratio will remain between 1.5 and 2.5 times net debt to adjusted EBITDA, signaling a healthy balance sheet post-acquisition.

Reshaping the Competitive Landscape

Astec's move to absorb CWMF occurs within a dynamic and competitive global market for asphalt and concrete paving equipment, valued at nearly $3 billion in 2023 and projected to exceed $4.5 billion by 2032. While Astec is a major player, it faces stiff competition from global giants like the Wirtgen Group, Caterpillar, and the Ammann Group.

The market, however, remains relatively fragmented. In 2024, the top ten manufacturers accounted for just 24% of total market revenue, leaving significant room for strategic consolidation to alter the competitive balance. By acquiring CWMF, Astec not only removes a niche competitor but also absorbs its specialized expertise, particularly in RAP processing—a critical area as the industry pushes for greater sustainability and cost efficiency through recycling.

This consolidation strengthens Astec's product portfolio and increases its production capacity, better positioning it against larger rivals. The integration of CWMF's custom-built solutions with Astec's own technologically advanced plant designs could create a more comprehensive and appealing offering for a wider range of customers, from small independent contractors to large-scale infrastructure firms.

Riding the Wave of Infrastructure Spending

The timing of the acquisition is particularly opportune, aligning with a period of historic investment in American infrastructure. The Bipartisan Infrastructure Investment and Jobs Act (IIJA), signed in late 2021, has allocated over $1 trillion for national projects, including a landmark $110 billion specifically for repairing and upgrading roads and bridges.

As of early 2024, over $480 billion in IIJA funding had been announced for more than 60,000 projects nationwide, directly fueling demand for the asphalt plants, pavers, and crushers that Astec and CWMF manufacture. The U.S. Department of Transportation has reported that this funding has already supported work on 135,000 miles of roads and 7,800 bridges. Market forecasts predict the U.S. transportation construction market will grow to a record $209.1 billion by 2026.

While this spending creates a robust demand environment, the industry is not without its challenges. Contractors face persistent headwinds from inflation, rising material costs, and skilled labor shortages. Furthermore, uncertainty looms as the IIJA's five-year funding authorization is set to expire in October 2026. Despite these potential obstacles, Astec's acquisition of CWMF strategically positions the company to capitalize on the current infrastructure boom, leveraging its newly expanded capacity and regional strength to meet the heightened demand for road-building equipment across the country.