Colas-Suit-Kote Settlement Requires Four Asphalt Facility Divestitures

A proposed settlement addressing Colas Inc.’s acquisition of Suit-Kote Corporation would require the sale of four asphalt facilities to preserve competition in asphalt emulsions and pavement-preservation services. The agreement was reached by the New York Attorney General’s Office and the Pennsylvania Office of Attorney General following antitrust investigations. It is pending federal court approval; the Pennsylvania filing is a complaint and settlement, and the signed agreement described in the source is effective October 13. The remedy is intended to address concerns that combining two leading regional suppliers could reduce competition, raise prices, lower service quality, or produce less favorable terms for public and commercial buyers. The settlement does not constitute an admission of wrongdoing by either company.

The divestiture package includes three former Suit-Kote locations in New York—the regional headquarters in **Jamestown**, plus manufacturing and storage facilities in **Buffalo** and **Belmont**—and one Colas facility in **Bloomsburg, Pennsylvania**. All four must be transferred to a single buyer approved by New York’s attorney general. The buyer must demonstrate the financial, technical, and operational ability to run the facilities as a viable, continuing pavement-preservation business, rather than simply acquire the real estate. This makes the matter a potential asset acquisition for an established asphalt supplier or another qualified operator able to sustain production and service capacity in the affected markets.

The package includes support for the Bloomsburg site. Colas must provide for a new asphalt-emulsion mill and storage capacity capable of producing at least **4 million gallons annually**. If the facility is sold before the mill is built, Colas must fund completion; its obligation for the mill build-out is capped at **$3 million**. The buyer may also request pavement-preservation equipment valued at up to **$3.5 million at each of the Belmont and Bloomsburg locations**. Pennsylvania’s announcement describes a combined **$6.5 million** commitment for Bloomsburg mill, storage, and equipment build-out, while the broader terms describe up to **$10 million** across the capped mill financing and optional equipment at both sites. These commitments may lower the capital burden for a buyer, but operating readiness, staffing, logistics, and customer retention will remain important diligence considerations.

The competition implications are concentrated in public road maintenance. According to New York’s investigation, Colas and Suit-Kote were often the only regular bidders for pavement-preservation services in **Cattaraugus, Chautauqua, Erie, Genesee, Livingston, Monroe, Niagara, Orleans, and Wayne counties**, including municipalities served through county contracts. Local highway departments often procure pavement preservation as a combined service because they lack specialized application equipment and crews. The companies also serve **PennDOT**, municipalities, and commercial purchasers in Pennsylvania. For contractors and public works buyers, the divestiture could preserve another source of materials and crews, but the competitive effect will depend on court approval, the selected buyer’s capabilities, and the timing of the post-closing sale process. The U.S. Department of Justice ended its merger review without conditions, while the state attorneys general pursued the remedy.

• Four facilities must be divested to one qualified buyer: Jamestown, Buffalo, and Belmont in New York, and Bloomsburg in Pennsylvania.
• New York’s attorney general must approve the buyer, who must show financial, technical, and operational capacity to compete and continue the business.
• Bloomsburg must receive an asphalt-emulsion mill and storage capacity rated for at least 4 million gallons per year.
• Colas’s mill build-out financing obligation is capped at $3 million, including if the buyer acquires the site before construction is complete.
• The buyer may request equipment worth up to $3.5 million at Belmont and $3.5 million at Bloomsburg; the support is optional and site-specific.
• Pennsylvania’s announcement describes a $6.5 million Bloomsburg commitment for mill, storage, and pavement-preservation equipment; the broader stated maximum across mill financing and optional equipment is $10 million.
• The remedy responds to concerns that the merger could raise prices, reduce service quality, or worsen terms for asphalt emulsions and pavement-preservation services.
• Public buyers potentially affected include PennDOT, Pennsylvania municipalities, and local governments and county highway departments in western New York.
• Prospective buyers should assess facility condition, production capacity, equipment needs, workforce and operating requirements, and the ability to serve existing public and commercial customers.
• The settlement is pending court approval; the divestiture timetable begins after the acquisition closes, so interested operators should monitor approval and sale milestones.