CRH sells United States distribution arm to Beacon Roofing for $2.6 billion

CRH to dispose of Americas distribution business for €2.2bn as profits increase 10pc

CRH to dispose of Americas distribution business for €2.2bn as profits increase 10pc

In the Americas, CRH reached agreement to sell its Americas Distribution business to Beacon Roofing Supply, Inc. for a total consideration of $2.63 billion in cash or about 2.2 billion euros.

"For the second half of the year, despite currency headwinds and continuing challenging conditions in the Philippines, we expect a continuation of the first half momentum experienced in Europe and EBITDA growth in the Americas, which will result in another year of progress for the group", Manifold said.

Buildings materials group CRH PLC (LON:CRH) has announced the sale of its U.S. distribution business and the acquisition of Germany's Fels as it reported its first half results.

While group earnings before interest, taxes, depreciation and amortisation was up 2 per cent on a like-for-like business compared to the same period in 2016, the same metric in Asia was 39 per cent below the first half of previous year.

Pretax profit for the first half was 27% higher at EUR517.0 million from EUR407.0 million the year before.

"The acquisition and divestment activity announced by the group today, demonstrates our ongoing strategic focus on allocating and reallocating capital at attractive multiples, while our significant balance sheet capacity ensures we are well positioned for further growth", said chief executive Albert Manifold.

The Irish firm has been in USA distribution for 20 years, but said today that it is selling its distribution business because its can not foresee becoming a market leader.

Like-for-like sales rose 3% in Europe, 1% in the Americas and fell 8% in Asia. In 2016, Americas Distribution reported EBITDA of 150 million euros on sales of 2.3 billion euros.

"When we look at the value we could crystallise through this transaction, no way could we create that value for our shareholders if we were to hang onto the business", Manifold said of the USA sale in a telephone interview.

CRH said the deal will give it a number two position in the European lime market while providing a platform for further growth.

CRH has raised its interim dividend payment by 2% to 19.2 cents a share. Profit before tax for the year amounted to 121 million euros. In 2016, Fels reported EBITDA of 70 million euros on sales of 260 million euros.

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