Ireland’s CRH Agrees to Sell European Distribution Business

Ireland’s biggest firm CRH (CRH) said early Tuesday that it agreed to divest its European distribution business to private equity funds managed by the US-based Blackstone (BX) for an enterprise value of 1.64 billion euros ($1.85 billion) in cash.

The decision follows a “comprehensive strategic” review by the Dublin-based building materials group over the last several months that culminated with a proposal to exit from the distribution businesses across the firm, creating a simpler and more focused organization.

The company, which supplies building materials through a network of local and regional brands across six countries in western Europe, said in a statement that the proceeds would be used for general corporate purposes, acquisitions, as well as capital return via its ongoing share buyback program.

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“The transaction demonstrates the continued execution of CRH’s strategy of creating value for our shareholders through active portfolio management, the efficient allocation of capital and creating a simpler and more focused Group,” Chief Executive Officer Albert Manifold said in the statement.

In 2018, the distribution unit, which comprises CRH’s entire General Builders Merchants business in Europe, including the company’s Sanitary Heating and Plumbing businesses, reported adjusted earnings before interest, tax, depreciation and amortization of 155 million euros on proforma sales of 3.7 billion euros.

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