Building Materials Company CRH Divests European Lime For $1.1B
Portfolio Pulse from Lekha Gupta
CRH PLC has agreed to sell its European lime operations to SigmaRoc plc for approximately $1.1 billion. The divested business includes 16 locations across Europe, with $610 million in sales and $137 million in EBITDA for 2022. The deal will be completed in phases, starting in early 2024. CRH also recently purchased Martin Marietta Materials Inc's South Texas cement and concrete operations for $2.1 billion. CRH reported a sales increase of 8% year-over-year and an improved EBITDA margin for the first nine months of the year. CRH shares rose by 4.07% to close at $61.13 on Tuesday.
November 22, 2023 | 10:08 am
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NEUTRAL IMPACT
Martin Marietta Materials Inc sold its South Texas cement business and related concrete operations to CRH PLC for $2.1 billion in cash.
While the sale of the South Texas cement business provides Martin Marietta Materials with a significant cash inflow, the impact on the stock price is uncertain without further details on how the proceeds will be used or how this affects the company's overall strategy.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 50
POSITIVE IMPACT
CRH PLC is divesting its European lime operations for $1.1 billion and has acquired Martin Marietta Materials Inc's South Texas cement business for $2.1 billion. The company also reported an 8% increase in sales and an improved EBITDA margin.
The divestment of the European lime operations at an attractive valuation and the acquisition of the South Texas cement business indicate a strategic portfolio management move by CRH, which is likely to be viewed positively by investors. The reported increase in sales and improved EBITDA margin further support a positive outlook for CRH's stock in the short term.
CONFIDENCE 90
IMPORTANCE 90
RELEVANCE 100