A supplier of hot asphalt will divest two plants as part of a settlement with the U.S. Department of Justice and the Tennessee attorney general over its acquisition of another hot asphalt company.

CRH and its subsidiary APAC-Tennessee are purchasing Standard Construction, according to the Justice Department. The companies are two of the three top asphalt producers in western Tennessee, the department said.

The Justice Department's Antitrust Division filed a motion to intervene, arguing that the acquisition could reduce competition and raise asphalt prices for the Tennessee Department of Transportation.

The department is already grappling with increased costs, according to a draft report presented to the Tennessee Advisory Commission on Intergovernmental Relations by commission staff in June. The Department of Transportation needs roughly $1.6 billion to maintain its existing infrastructure and $3.6 billion to make improvements as the state grows, according to the report.

Forty percent of the state's transportation budget, about $1.2 billion annually, comes from the federal government, primarily from federal fuel taxes on gas and diesel, according to the report. Of the remaining 60% of the department's budget, 30% comes from state fuel taxes, which are 27 cents per gallon for gasoline and 28 cents for diesel. Tennessee's fuel taxes have not increased since 2020 and rank in the middle when compared to surrounding states.

As part of the settlement with the Justice Department, APAC-Tennessee will sell two hot-mix asphalt plants in western Tennessee to Dunn Construction of Birmingham, Alabama.

“State antitrust enforcers can play an important role in merger enforcement in local markets in which potential harm is limited to a single state,” said Deputy Assistant Attorney General Charles Beller of the Justice Department's Antitrust Division. “This enforcement action builds on recent consent settlements we have taken alongside other state attorneys general to obtain local concrete plant divestitures in California and power plant divestitures in Texas.”

The Center Square was unsuccessful prior to publication getting comment from CRH.