Sunday 25 February 2018

CRH licking its lips over Indian takeaway

IS CRH gearing up for an Indian takeaway? Last week it was tipped to spend up to €1.3bn on Jaypee Cement a division of Indian construction conglomerate Jaiprakash Associates, best known for developing India's only F1 track.

CRH's ever-restless executives have, according to reports, toured the four plants up for sale in western and Southern India in a move which will further diversify it into the BRIC countries.

The Irish outfit enters the race however behind India's number one cement maker Ultratech Cement and the prospect of the two going head-to-head is clearly good news for Jaiprakash Associates which is seeking to pay-down its $8bn debts.

Goodbody's Robert Eason notes that, after flogging its 49 per cent stake in Portugese firm Secil for €574m, CRH has "plenty of financial headroom".

An acquisition is likely to receive investor support from institutions still wary of any stock with significant exposure to the Eurozone.

However, the asking price looks to be on the rich side. There is a deal to be done but the Irish construction giant needs to be wary of overpaying for it.

Sunday Indo Business

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