Bribe allegation untrue, says CRH

CRH, Ireland’s largest company, has been embroiled in a €827,000 million bribery allegation in Poland.

Jailed Polish businessman Marek Dochnal, who sold his business to CRH, told a parliamentary inquiry he paid a bribe of €827,000 on behalf of the company to a Polish government minister.

Dochnal is in prison awaiting trial on another bribery charge.

He paid most of the money to former minister for privatisation Wieslaw Kaczmarek, he said. It was linked to the controversial privatisation of a cement plant at Ozarow, in 1995.

Mr Kaczmarek was paid between €495,000 and €575,000 in cash by CRH, through an intermediary, and a further €205,000 was paid into a Swiss bank account, Dochnal told the inquiry.

CRH said in a statement if such an allegation was made “it is absolutely without foundation. CRH did not pay money directly or indirectly or authorise any such payment to any Polish government representative or official and has no knowledge of any such payment having been made.”

A company spokesman said there was no basis for this allegation and did not expect the group to have to face any further such accusations relating to any past acquisitions it has carried out.

In recent years, the group has been chalking up about €1 billion in takeovers a year.

On the examination of the transcript of the evidence, CRH said it still wasn’t clear the allegation was made against the company in the manner suggested.

The evidence emerged into an inquiry into the privatisation of Orlen, the state electricity company, and had nothing to do with its own business dealings in Poland.

Any allegations if they have been made “are absolutely without foundation”, he said.

It emerged that CRH had an involvement with Dochnal when it acquired a 40% stake in an investment firm, Holding Cement Polski (HCP), from Larchmont Capital, where Dochnal was the major shareholder.

HCP acquired a 75% shareholding in the privatised plant. CRH paid IR£29.7 million at the time and increased its stake in the plant over the next three years.

By the end of 1998 CRH owned 96% of HCP, which owned 87% of the Ozarow plant.

Two CRH executives, Brian Griffin and Declan Doyle, were awarded national medals by Poland’s president Aleksander Kwasniewski.

Dochnal told the inquiry on March 5 that Mr Kaczmarek’s representative demanded $1 million to facilitate the takeover of the plant.

“This is about the privatisation of the Ozarow cement plant, when I met with a specific demand and it was a very unpleasant experience,” he said.

Trade unions opposed the CRH takeover at the time and favoured a rival bid from Ciech, Poland’s state-owned chemicals and oil trader.

Ciech withdrew its bid and Mr Kaczmarek threatened to float the cement plant on the stock exchange unless the unions accepted the CRH bid.