Building materials group CRH is set for a major expansion of its American operations with the €160 million acquisition of the US Aggregates business in the western and south-eastern United States.

The acquisition is still subject to a number of conditions as US Aggregates has filed for bankruptcy protection under the American Chapter 11 code.

As a result, a competitive auction must be held for the assets for which CRH has made an agreed bid.

Even if CRH wins in this auction, the takeover is then subject to the approval of the bankruptcy courts although this is unlikely to be a major obstacle.

The acquisition represents a major expansion of CRH's operations in the mountain states of the US.

US Aggregates has extensive aggregates, asphalt and readymixed concrete operations in Utah, Arizona and Nevada while CRH already has a major presence in Utah.

US Aggregates business in the mountain states has total reserves of 300 million tons. Last year, the group sold 5.3 million tons of aggregates, 1.3 million tons of asphalt and 300,000 cubic yards of ready-mixed concrete.

In the south-east, US Aggregates' assets include an aggregates business in the Birmingham, Alabama and Chattanooga, Tennessee areas with annual volumes of 7.7 million tons and access to 340 million tons of reserves. The deal also includes a ready-mixed concrete business in Chattanooga.

Earlier this year, CRH also bought the US Aggregates subsidiary in Idaho, Monroc, for €24 million.

The chief executive of CRH's Oldcastle operations in the US, Mr Tom Hill said: "This potential transaction provides significant opportunities for Oldcastle. It would enable us to further expand our operations in the mountain region, in particular increasing our ability to expand production to serve the ever-growing Salt Lake City area and extending our business into the attractive Cedar City/St George region in southern Utah.

"We expect to improve the profitability of the assets acquired through elimination of duplication costs as well as greater efficiencies in purchasing, production and transport. The proposed deal also offers the prospect of strategic entry into a new region for Oldcastle with the acquisition of US Aggregates south-eastern assets in Alabama and Tennessee."