CRH to seek further acquisitions

CRH has said that it will continue to pursue acquisitions, having already spent €200 million on bolt-on buys and investments during the first half of the year, and agreeing another deal worth nearly €100m.

Yesterday’s capital spend update from the Dublin-headquartered international building materials giant revealed that the group has reached agreement to buy the privately owned Belgian VVM Group for nearly €100m, taking CRH’s spending to nearly €300m for the year to date.

VVM operates cement grinding and ready-mixed concrete plants in Belgium and France.

The deal, subject to regulatory approval, has been done through CRH’s Europe Materials division. Of the €200m first-half spend, that division accounted for €40m on one acquisition and two investments.

The group’s Europe Products & Distribution division spent €20m on four acquisitions and one investment, its Americas Materials business spent €98m on seven acquisitions and two investments and its Americas Products & Distribution division completed four acquisitions, totalling €28m.

CRH chief executive Myles Lee said the first-half spend should strengthen the group’s existing market positions, while adding valuable and well-located aggregate reserves.

He said the Belgian acquisition will complement CRH’s existing products businesses in the Benelux region and “represents an important strategic opportunity for our existing Cementbouw cement trading and ready-mixed concrete business.”

With regard to possible spending patterns for the second half of the year, Mr Lee added: “The pipeline of potential acquisitions remains good, and with our strong balance sheet, we have the capacity — where we see value — to capitalise on these opportunities.”

Mr Lee added that CRH’s “proactive approach to portfolio management” was reflected in the completion of a number of divestments “which generated proceeds for reinvestment of approximately €345m in the first half of 2011”.

CRH also managed to complete a number of disposals during the first six months of the year, including its European Insulation and Climate Control businesses and its 35% stake in French distribution company, Trialis. Proceeds from the sales totalled €345m.