The latest batch of bolt-on acquisitions announced by building materials group CRH should boost earnings per share by about 2.5 per cent, according to house broker Davy.
CRH yesterday unveiled acquisitions and capital expenditure in the second half of 2001 totalling €359 million (£283 million), bringing acquisition and capex spend for the year to around €1 billion.
However, in taking a different tack, ABN-Amro analyst Mr Tony Williams has warned that CRH's "tried and tested bolt-on acquisition strategy" may be coming under pressure in terms of the size of the various deals required to have any meaningful effect on the group's bottom line.
Mr Williams noted that even though CRH raised €1.1 billion in a rights issue last March, the pace of acquisitions has slowed - €1 billion last year against €1.6 billion in 2000 - and added that this might indicate deals were becoming harder to identify. The €359 million second-half spending announced by CRH does not include the €134 million spent on a 25 per cent stake in Israeli cement group Nesher and two bigger US acquisitions, Hallet Materials and Des Moines Paving.
