CSR Group subsidiary Rinker Materials Corporation(“Rinker”) has finalised negotiations to acquire Kiewit Materials Company(“Kiewit Materials”), a major integrated aggregates, concrete and asphalt companywith operations in Arizona and other western states of the United States.

The purchase price is US $540 million net of projectedsurplus cash at closing.Thetransaction is expected to be finalised by 30 September, subject to shareholderand regulatory approvals.

Kiewit Materials is the 16th largest aggregatesproducer in the US, centred in the high population growth regions of the westand southwest US.

The acquisition would lift both Rinker’s currentaggregates sales and its premix concrete output by around 50%.

Approximately 80% of Kiewit Materials’ operations are in Arizona,the second-fastest growing state in the US, where population growth hasaveraged 3.6% compound from 1970-2000.This is around three times the US national average.

Kiewit Materials’ operations are also located (seemap attached) in:

The Pacific North-West, around Portland, Oregon andsouth-west Washington

In California, in the north San Francisco Bay areabetween Vallejo and Sacramento, and in the Yolo Valley in central California

In Wyoming, Nebraska, Utah and NewMexico.

Operations include 44 aggregates facilities,including 8 hard rock quarries, supplying 28 million tons of aggregate ayear.Kiewit Materials also produces4.7 million cubic yards of concrete a year in 60 plants, and 3.4 million tonsof hot-mix asphalt in 16 asphalt plants.Aggregate reserves total over 800 million tons, with reserve lifeaveraging over 30 years.

CSR Managing Director and Chief Executive Peter Kirby saidthe acquisition will be a major strategic expansion for Rinker in the US,giving the company strong positions in a number of states including the leadingposition in Arizona.It also providesexcellent opportunities for further growth in the west and southwest of the US.

“It is in linewith the strategy of growing in the heavy building materials sector bydeveloping strong, local positions in high population and economic growthregions.Kiewit Materials is the numberone or number two supplier of aggregates, concrete and/or asphalt in most ofits markets.”

Rinker Chief Executive David Clarke said the KiewitMaterials acquisition fits well with Rinker’s existing operations, particularlyin Washington state and Las Vegas.

“It would enable Rinker to leverage those existing businessesfurther with regard to customer service, purchasing, operational efficienciesand other synergies,” said Mr Clarke.

“Kiewit Materials has a strong management team and manyhigh calibre employees throughout the business, and we expect to build on thisfoundation to further improve performance.”  

The US $540 million purchaseprice, net of projected cash at closing, is for 100% of the outstanding stockin Kiewit Materials.Under the terms ofthe agreement, Rinker will commence a tender offer for all of Kiewit Materials’outstanding common stock for US $17 cash per share.Conditions of the offer require at least 90 % acceptance.Any shares not acquired in the tender offerwould be acquired in a subsequent short form merger transaction at the same pershare consideration.

The price represents a multiple of 7.1 times historic EBITDA. The acquisition is projected to be earnings positive this financialyear and delivering above its cost of capital after the first full year.

Kiewit Materials was spun off from theprivately-owned Peter Kiewit Sons, Inc. in September 2000. Kiewit Materials isa private company. Its shareholders are almost entirely current or formeremployees of Peter Kiewit Sons, Inc. and Kiewit Materials. Kiewit Materialssales revenue in calendar 2001 was US $509 million, and earnings beforeinterest and tax were US $57.5 million.

The CSR group is the world’s ninth largestheavy building materials group, with sales revenue of A$7 billion, operatingcash flow of A$1.4 billion and around 16,000 employees in over 600 sites acrossthe US, Australia, New Zealand and Asia.

Including the Kiewit Materials operations, Rinker will bethe fifth largest aggregates producer in the US, supplying over 84 million tonsper year, and the second largest producer of pre-mix concrete, supplying 13million cubic yards each year. 

This release contains forward-looking statementsthat involve assumptions regarding the operations and future prospects of CSR.Although CSR believes these statements are based on reasonable assumptions,such statements are subject to risk and uncertainty, including, among otherthings, economic conditions in the markets served, levels of constructionspending in the markets served, transportation costs, competition from existingor future competitors, the ability to integrate acquisitions quickly andeffectively, and the ability of Rinker to successfully complete the tenderoffer.Caution should be taken thatthese factors could cause the actual results to differ from those stated orimplied in this and other communications.

THIS ANNOUNCEMENT IS NEITHER ANOFFER TO PURCHASE NOR A SOLICITATION OF AN OFFER TO SELL SHARES OF KIEWITMATERIALS.RINKER INTENDS TO FILE ANOFFER TO PURCHASE AND A LETTER OF TRANSMITTAL WITH THE UNITED STATES SECURITIESAND EXCHANGE COMMISSION (“SEC”) RELATING TO ITS OFFER TO PURCHASE ALLOUTSTANDING SHARES OF COMMON STOCK OF KIEWIT MATERIALS.BEFORE ANY DECISION IS MADE WITH RESPECT TOTHE OFFER, ALL STOCKHOLDERS OF KIEWIT MATERIALS ARE STRONGLY ADVISED TO READTHE OFFER TO PURCHASE AND LETTER OF TRANSMITTAL WHEN THESE DOCUMENTS BECOMEAVAILABLE AND THE RELATED SOLICITATION/RECOMMENDATION STATEMENT THAT WILL BEFILED WITH THE SEC BY KIEWIT MATERIALS.THESE AND OTHER DOCUMENTS FILED WITH THE SEC WILL CONTAIN IMPORTANTINFORMATION RELATING TO THE OFFER.THESE DOCUMENTS WILL BE AVAILABLE AT NO CHARGE ON THE SEC’S WEBSITE AT HTTP://WWW.SEC.GOV. COPIES OF THE OFFER TOPURCHASE AND CERTAIN RELATED DOCUMENTS MAY BE OBTAINED FROM RINKER FOR FREE BYCONTACTING THE INFORMATION AGENT FOR THE OFFER AS WILL BE DESIGNATED IN THETENDER OFFER MATERIALS THAT WILL BE DISTRIBUTED TO KIEWIT MATERIALSSHAREHOLDERS.