CRH has said this morning its looking into buying a large number of the US and European business interests of the Mexican cement maker CEMEX in a deal, potentially valued at between $3.5 and $4.5 billion.
The deal would be one of the biggest ever in Irish corporate history and the largest so far this year.
The negotiations involve assets which CEMEX is selling under competition rules because of its own acquisition activity. Cemex is the biggest cement maker in the US.
Earlier this year Cemex took over Australian rival Rinker fir $14.25 bn and as a result the US Department of Justice has required Cemex to sell operations in Florida and Arizona. These are the assets that CRH is considering buying.
In addition CRH is in negotiations to acquire from Cemex's interests in Florida, Arizona, Utah, Wyoming, Nebraska, New Mexico and Texas, Kentucky, Pennsylvania and Ohio as well as assets in Spain, Austria and Hungary.
Detailed combined financial information is not yet available, a statement said today, though a rough estimate of between €2.5 bn and €3.2 bn was given.
'Depending on the scale of businesses included in any potential deal, and the outcome of due diligence, a transaction size in the range of US$3.5 billion and US$4.5 billion is possible', it said.
Davy analyst Barry Dixon said the deal was a 'good fit strategically'.
'This is a very interesting development for CRH and illustrates its ability to use its balance sheet strength to make substantial opportunistic acquisitions,' Dixon said in a research note.
'This is positive for the stock, which has recently underperformed,' he added.
CRH said it has sufficient balance sheet capacity to debt-finance any transaction that might take place.
The completion of any transaction would be subject to satisfactory due diligence.
Last week CRH announced four acquisitions, worth €258m, by its American Materials Division.
Last year CRH bought US asphalt business, Ashland Paving and Construction (APAC) for $1.3 billion (€1 billion), which was its biggest acquisition.
Although the sums in today's deal are potentially enormous - the deal falls far short of last year's $5 billion merger between the online education company Riverdeep and American publisher Houghton Mifflin.
It is well behind the €6 billion merger between Jefferson Smurfit and Kappa Packaging in 2005.
CRH shares closed down 94 points at €26.70 in Dublin this evening.
