Belarus woos CRH for $200m cement deal

The government of Belarus says it has offered to sell its state-owned cement company, Krasnoselskstroymaterialy, to Irish building materials giant CRH for $200 million (€172 million).

CRH responded by saying it does not comment on "speculation" relating to potential deals. However, the former Soviet state's deputy prime minister, Anatoly Kalinin, suggested talks on a possible deal were ongoing.

The government of Belarus, which separates Poland from Russia, has attempted to woo investment from CRH in the past. Two years ago, its UK ambassador, who is also responsible for relations with Ireland, met with senior CRH executives while on a trip to Dublin. Belarus’s foreign ministry at the time suggested CRH had been invited to invest there.

Privatisation programme

The sale of Krasnoselskstroymaterialy is being considered by Belarus as part of an ad-hoc privatisation programme. Mr Kalinin was reported locally to have said this month that Belarus wants $200 million but CRH wants to pay less.

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“[CRH] is unwilling to buy the entire enterprise although we offer 100 per cent of the shares. Negotiations are in progress. They are rather consistent. Our views are getting closer,” he reportedly said.

CRH is heavily invested in region, particularly in Poland and also Ukraine, which sits to the south of Belarus. It entered Ukraine in 1999 and bought further plants in the region as recently as 2013. It invested €210 million to overhaul its main Ukrainian cement plant in a revamp that finished in 2011

Krasnoselskstroymaterialy is the largest cement manufacturer in Belarus, and exports to all neighbouring countries.

On Monday, stockbroker Davy raised its price target to €37 for CRH, which closed in Dublin at €31.83.