CRH HAS succeeded in raising €1.24 billion through the sale of new shares in the biggest corporate rights issue in the State’s history.

The building materials giant said yesterday that its offer of just over 152 million new equities to existing shareholders at €8.40 each was 94.4 per cent subscribed. The underwriters, Dublin stockbrokers Davy and Swiss bank UBS, succeeded in placing the remaining units for €15.95.

Those shareholders who did not take up their rights under the offer were paid the difference between the rights issue price of €8.40 and the €15.95 price at which the 5.6 per cent were sold.

CRH offered the units to existing shareholders on a two for seven basis. The issue raised €1.238 billion net of expenses.

Announcing details of the issue earlier this month, CRH said it intended using the cash raised to fund acquisitions and to pay off €500 million in debt.

The Irish player is one of the biggest in its industry in the world, and has largely grown through a policy of buying smaller rivals and absorbing them into the overall group. As the European and US building industries have been shrinking since mid 2007, the group believes that this is forcing down the cost of buying businesses.

Announcing the rights issue two weeks ago, chief executive Myles Lee said larger rivals were being forced to scale back operations as many of them had large debts as a result of borrowing heavily to fund expansion.

Low borrowing costs and a boom in private equity deals combined to inflate prices at which businesses in the sector were sold earlier in the decade. The subsequent downturn has left some players with large debts.

At the same time, Mr Lee said, owners of the smaller businesses that the Irish group typically buys were looking for less in situations where they were selling.

He pointed out that the cost of buying businesses was coming down. “We think there is going to be a large pool of opportunities for us, and as a result we are raising capital.”

In addition, the company intends extending the maturity – the repayment dates – on €670 million of its debt, which is to fall due next year.

This, combined with the €738 million left from the fundraising following the €500 million debt repayment, will give it the cash it needs to fund any purchases.

In 2008, CRH spent €1 billion on acquisitions.

This was twice what it spent the previous year, when it made its largest ever purchase, US asphalt producer Apac.