CRH linked to €890m deal for Lafarge asset

CRH is being linked with a second potential Asian deal in as many weeks, this one with a price tag of around $1bn (€890m).

A Mergermarket report has it that CRH is one of 16 likely bidders for assets in eastern India being sold by French cement giant Lafarge.

The disposal makes up part of the conditions related to Lafarge’s mega-merger with Swiss counterpart Holcim.

CRH is an obvious bidder given that the Irish building materials giant already has a presence in southern India and is in the process of buying €6.5bn worth of assets as part of the Holcim-Lafarge deal.

However, Mergermarket claims CRH is vying with HeidelbergCement, among others, for the new assets and has until the end of this month to complete due diligence and until July 15 to submit a binding bid.

However, that has not dulled analyst fervour. In a research note, published yesterday, Robert Eason of Goodbody Stockbrokers suggested such outlay is well within CRH’s capabilities.

“While CRH is currently completing the biggest acquisition in its history, the CEO said at a recent interim management statement conference call that the pipeline was quite strong across the businesses,” said Mr Eason.

“Given the cashflow generation of the business, CRH’s balance sheet deleverages quickly and, as a result, we believe it is well-positioned to do such deals.”

Last week, CRH was linked to a possible €800m move for the number two player in South Korea’s cement market. The company has made no comment on speculated deals. However, a successful move for all deals being considered by it, or linked to it, via speculation, would boost its 2015 spend to over €9bn.