Building materials giant CRH has entered negotiations with Jaypee Cement Corporation to pick up an equity stake in Jaiprakash Associates' operations in the western Indian state of Gujarat.

Jaiprakash's cement business in Gujarat consists of a 3.6 million tonne clinker plant in western Gujarat and a grinding plant in eastern Gujarat with the capacity to produce 2.4 million tonnes per annum.

In July, CRH was reported to be eyeing an expansion in India and was in the race with Ultratech Cement, India's No 1 cement maker, to buy two plants owned by Jaiprakash Associates.

The Economic Times yesterday reported that the Iseq index heavweight was close to picking up a 51 per cent stake in Jaiprakash Associates' cement operations in Gujarat.

Shares in CRH were up 1 per cent at €15.66 at 10.50am on the Irish Stock Exchange. Shares in Jaiprakash Associates were up 2 per cent at 77.55 rupees on the National Stock Exchange.

Additional reporting: Reuters