Aggregates Industry Eager to Resume Portfolio Realignment Efforts in 2026
Capstone’s latest Rock Products Sector Update reports that Aggregates industry merger and acquisition (M&A) activity contracted in 2025 as macroeconomic and tariff-based market uncertainty accelerated. However, aggregates demand tailwinds from public infrastructure funding, heightened data center construction, and sustained pricing power are expected to help reenergize M&A activity. Moreover, participants have increasingly looked to resume portfolio realignment efforts emphasizing regional market share strength and vertically integrated business models.
The phased deployment of Infrastructure Investment & Jobs Act (IIJA) funding coupled with rising demand for data center and power infrastructure construction bolstered Aggregates industry growth in 2025. Since distributions began in 2022, federal IIJA infrastructure spending has helped maintain aggregates demand despite continued weakness in residential and light nonresidential construction and a recent slowdown in manufacturing development. Moreover, the rapid commercialization of artificial intelligence (AI) solutions has underpinned tailwinds stemming from booming data center construction. This momentum is expected to persist, accelerating power infrastructure development as AI-related power demand strains U.S. energy capacity. In addition, sustained pricing strength in 2025 was beneficial for participants aiming to insulate margins and offset pockets of end-market construction demand weakness. On the flip side, pricing power will likely remain a tailwind to sector participants serving markets with healthy regional demand, data center construction, and public infrastructure funding.
A muddied macroeconomic backdrop saw Aggregates industry M&A volume decline 26.7% year-over-year (YOY) in 2025 to 107 announced or closed transactions. Sustained pricing strength and resilient end-market demand will likely help reignite inorganic portfolio realignment efforts that moderated in 2025 following recent macroeconomic and tariff-induced deal hesitancy. The growing importance of regional market share and vertical integration within the Aggregates industry has fueled inorganic growth activity over the years as operators have sought to unwind horizontally integrated operations. Looking ahead, improving market clarity, strong pockets of end-market demand, and an eagerness to resume these portfolio reorganizations has buoyed M&A momentum and improved the dealmaking outlook for 2026. Notably, deal volume through year-to-date (YTD) 2026 has paced YTD 2025 with 11 transactions.
Pricing power and margin strength have boded well for sector valuations through YTD 2026. While dealmaking failed to meet or exceed the record transaction volume and value captured in 2024, M&A activity in 2025 remained healthy and in line with historic averages. Notably, fewer large-scale transactions saw total disclosed deal value fall 77.2% YOY from $20.5 billion to $4.7 billion in 2025. Despite the slowdown in large-scale M&A, Aggregates industry transaction multiples have averaged 9.4x EV/EBITDA from 2024 to YTD 2026, half a turn higher than the 8.9x EV/EBITDA average seen between 2022 and 2023. Asset-rich businesses and divested operations with synergistic portfolios and strategic market share coverage have garnered premium prices, a trend that will likely persist throughout 2026.
Also included in this report:
An analysis and snapshot of broad construction input costs as well as key Aggregates industry pricing trends.
A look into historical aggregates production and pricing trends for cement, ready-mix concrete, sand and gravel, asphalt, and crushed stone.
Capstone Partners’ Building Products Investment Banking Team provides M&A, capital formation, and financial advisory services to the owners of middle market businesses in the Rock Products and Aggregates Industry. Our team partners with leading mid-to-large sized businesses that serve growing end-markets.
For more information on the Aggregates Industry Market trends featured in this report or to speak with one of our Building Products M&A Team members about how to grow, value, and/or sell your company, we are here to help. Contact us today.
