(Bloomberg) -- CRH Plc, the US-Irish building materials group, is considering reviving a sale of its Philippines cement business, people familiar with the matter said.
The New York and Dublin-based company is working with UBS Group AG to help sound out preliminary interest from prospective buyers, the people said, asking not to be identified because the matter is private. A potential sale could attract other industry players, they said.
No final decisions have been made and CRH could decide against pursuing a transaction, the people said. Representatives for CRH and UBS declined to comment.
The company had earlier tried to sell its Philippines cement business to raise cash by divesting non-core assets, Bloomberg News reported in 2019. The assets could have been valued at $2 billion to $3 billion at the time. The unit is worth significantly less now because of a more challenging business environment, the people said.
The New York-listed shares of CRH have gained 45% this year, giving it a market value of $68 billion. The company, which is also listed in London, had about $35 billion in revenue last year, making it one of the biggest industry players in North America and Europe.
CRH entered the Philippines in 2015 when it acquired Republic Cement, the second-biggest cement producer in the country. It teamed up with local conglomerate Aboitiz Equity Ventures for that acquisition.
A potential exit from the Philippines “makes sense,” according to Bloomberg Intelligence. The company’s “strategy of avoiding emerging-market exposure is intact” and “there are better alternatives for its capital, given the challenging local-market environment over the past 10 years,” analysts Sonia Baldeira and Kevin Kouam wrote in a note Thursday.
CRH is a serial dealmaker. In the first nine months of this year, the company completed 28 acquisitions for $3.9 billion and divestitures and disposals of long-lived assets worth $1.2 billion, it said Thursday. The cement firm also forecast full-year net income of $3.78 billion to $3.85 billion, beating analyst estimates.
--With assistance from Cliff Venzon.
(Adds analyst comment, dealmaking volumes in last two paragraphs)
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