CRH linked to €400m takeover of Russian cement firm
Building materials giant CRH has declined to comment on speculation that it's in talks to acquire up to a 75pc stake in a Russian cement business for an estimated €400m.
Such a move would mark a long-held ambition for the Irish firm to enter the Russian market.
CRH is reportedly involved in negotiations to acquire a majority holding in BaselCement, which is controlled by Russian billionaire Oleg Deripaska.
The firm has two cement manufacturing sites -- one in Russia and the other in Kazakhstan.
The Russian plant is situated in Achinsk, a city about 4,000km east of Moscow with a population of close to 120,000.
The facility reportedly accounted for about 1.4pc, or 436,000 tonnes, of Russia's total cement production in the first six months of this year.
BaselCement's plant in Kazakhstan produced 400,000 tonnes of cement last year.
It's possible a deal with CRH could also include the acquisition of two factories currently being constructed by BaselCement.
A spokesman for CRH declined to comment yesterday. CRH already has operations in former Soviet states including Ukraine, Latvia and Estonia. It serves the St Petersburg market from its business in Finland.
Analyst Barry Dixon at Davy Stockbrokers said CRH had made "no secret" of its desire to enter the Russian cement market.
He added that if a deal was sealed it would be "interesting" for CRH, helping it to solidify a regional presence. Mr Dixon said the Russian cement market remained fragmented and was likely to enjoy "significant growth" in the future.
CRH spent €536m on acquisitions and development initiatives last year, €367m of it in the second half.
The purchases were concentrated in Switzerland, the US and Germany. They included 28 bolt-on acquisitions and added annualised sales of €800m to the group.
Shares in CRH rose 1.7pc to €11.31 yesterday in Dublin.