CRH raises holding in Polish firm to 86.9pc
BUILDING materials group CRH has significantly increased its stake in Polish company Holding Cement Polski to 86.9pc. CRH already had a 40pc stake in the company but added to this by buying a further 46.9pc, costing it £22.5m extra.The acquisition means that CRH will now greatly increase its exposure to one of Poland's largest cement producers, Cementownia Ozarow, in which Holding Cement Polski has a large shareholding.
It is expected that CRH will be making an announcement on the deal today.
The 46.9pc had been held by Polish industrial and trading conglomerate Elektrim, which sold its stake to CRH.
Following the news, CRH's share price in Dublin jumped by 23p or 2.5pc to close at 925p. One dealer said: ``CRH has attracted a lot more attention than the financials.''
The Irish company initially invested £15m in Poland by taking a stake in Holding Cement Polski and made a further investment in another company called Rejowiec.
Together, Rejowiec and Ozarow produce some 20pc of Poland's cement output. Construction is among the fastest growing sections of the economy.
Output in the construction industry is expected to grow by 18pc this year alone through strong demand for infrastructure and housing. Demand for new housing is expected to reach 6m units by 2010.
It is understood that it might have been too politically sensitive for an Irish company like CRH to have gone for a direct large shareholding in Ozarow because of its major role in Poland's development.