Cantillon: CRH hopes to build on Republican success
Majority of donations firm’s US unit raised for federal candidates went to Republicans
Donald Trump, presumptive 2016 Republican presidential nominee: billionaire plans to to spend $1 trillion on roads, bridges, tunnels and other parts of the US’s ageing infrastructure. Photograph: Chris Goodney/Bloomberg
’Tis an ill wind, and all that . . .
While CRH, which generates 13 per cent of its earnings in the UK, has seen its shares fall 3 per cent since the Brexit vote, political machinations since then and the catapulting of Theresa May into Downing Street may play into the hands of Ireland’s largest publicly traded company.
May’s pledge to build an economy “for everyone, not just the privileged few”, and her interventionist instincts draw a clear distinction between her and the UK’s only other female prime minister.
Analysts at Investec have warmed to May’s plans to invest more in infrastructure and plans for more government-backed infrastructure bonds to speed up and enhance investment. About 40 per cent of CRH’s British earnings come from infrastructure.
The brokerage also sees European politicians, fearing further populist uprisings after Brexit, easing back on austerity and beefing up investment.
But the big prize is in the US as Hillary Clinton and Donald Trump prepare to slog it out over the coming months to seize the keys to the Oval Office. Both, Investec reminds us, have flagged the importance of investing in infrastructure.
Clinton has published a detailed plan on how she would invest $275 billion in projects over five years in addition to the recently enacted $305 billion FAST Act highway spending programme.
The Donald, meanwhile, has promised to spend $1 trillion on roads, bridges, tunnels and other parts of the US’s ageing infrastructure. (Presumably he’s not including his planned wall on the Mexican border).
Trump’s plan is light on detail but there’s little doubt CRH is more a fan of Republican politics these days. A political donations pool organised by CRH’s US unit Oldcastle has been biased towards the so-called Grand Old Party in recent times, according to OpenSecrets.org, a Washington-based organisation that tracks US federal campaign contributions.
The Oldcastle Materials Inc Political Action Committee contributed almost $240,930 to federal candidates in the 2016 US election cycle, up until the end of April, according to OpenSecrets. Some 70 per cent of this was to Republicans.