CRH ‘well placed’

With total acquisitions in 2014 worth €190 million, and divestments worth €350 million, Irish-based international building materials group CRH has said that its refined portfolio focus meant the group was well-positioned to pursue acquisitions in line with its long-term growth strategy.

The group’s total 2014 acquisition and investment spend included the completion of 21 transactions, while there were 16 completed divestments.

Albert Manifold, CRH’s chief executive, said, “In August 2014, we announced a multi-year €1.5 billion to €2 billion divestment programme. The proceeds of €350 million generated in 2014 demonstrate that this programme is well underway.

“With a refined portfolio focus, the group is now well-positioned to pursue acquisitions which are in line with our long-term growth strategy. The 21 transactions completed during 2014 comprise primarily bolt-on acquisitions for our existing operations in the Americas, together with the expansion of our builders merchanting network in Europe.”

There were eight acquisitions and seven divestments in Europe. Included in the acquisitions, worth around €40 million, CRH’s heavyside operations acquired selected ready mixed concrete and aggregates assets of Cemex Ireland – including 12 million tonnes of high quality reserves. A precast concrete business in Denmark was also acquired, adding total annual sales of approximately €10 million. Its distribution business completed six acquisitions in Benelux, France and Germany, adding a total of nine branches with annual sales of about €70 million.

The €240 million-worth of divestments included the disposal of CRH’s 50% equity stake in Denizli Çimento, the group’s only involvement in the Turkish construction market. This was the largest single divestment in 2014, realising proceeds of €170 million.

The heavyside division also disposed of a number of ready mixed concrete and concrete products businesses, while all three of CRH’s Europe divisions realised proceeds from disposal of surplus assets. CRH said that as most of the divested entities had been equity-accounted by the group, the impact of these divestments on group sales was not material.

In the Americas, there were 13 acquisitions and nine divestments.

With acquisitions worth around €150 million, there were eight bolt-on acquisitions completed by the Americas materials division in 2014 throughout the US. This added annual incremental sales of approximately US$50 million (€42 million) and over 230 million tonnes of aggregate reserves.

CRH added that its Americas products division completed five transactions with around US$90 million (€76 million) of incremental sales in the precast, architectural products and construction accessories businesses.

Its divestments in the Americas were worth approximately €110 million.

The materials division disposed of several non-core operations across the US and completed an asset exchange in the state of Washington. The products division sold five operations in the precast, architectural products and building envelope businesses.