CRH faces new rival in Uniland race

Greek cement firm Titan has confirmed that it is among the short-listed companies carrying out due diligence on the Catalan group Uniland, in which CRH has a 26 per cent shareholding, writes Jane O'Sullivan, Markets Correspondent

One of two major Greek cement firms, Titan also has operations in the US, Egypt, Bulgaria and Macedonia. It aims to grow internationally through acquisitions, and sees foreign operations driving its earnings this year.

Shares in Titan rose by more than 3.5 per cent at one stage in Athens yesterday after it said it was looking at Uniland as a springboard to expand into the fast-growing Latin American market.

"We are doing due diligence on Uniland now. There is a lot of interest from other companies too," a Titan spokesman said.

Some five to six firms are thought to be still in the race to acquire the 73.7 per cent of Uniland that remains in the hands of the company's founding families, out of the more than 20 firms that initially expressed an interest.

Spanish media reports have said that two Spanish firms are involved in the sales process, which is being handled by US investment firm Lazard.

Fomento de Construcciones & Contratas, a unit of Portland Valderrivas, has already expressed its interest in Uniland, while Cementos Molins is also thought to be taking a close look at the company, which some observers believe will command a price of more than €1.5 billion.

In addition to Titan, US investment firm Prides Capital and two of Brazil's largest industrial conglomerates, Votorantim and Camargo Correa, are also thought to be in the running.

However, CRH - which has already declared its interest in acquiring Uniland outright - may yet find itself in a position to block the sale from going ahead.

A spokesman for the Irish building materials group confirmed that it had taken an action in the Barcelona commercial court last week, seeking direction on whether it has pre-emption rights over the shares being sold.

Uniland's bylaws stipulate that existing shareholders be offered the right of first refusal over any shares being sold, a clause that has already involved CRH in a legal wrangle with the family shareholders and led to its exclusion from the sale process.

They allege the Irish group's purchase of its shares last autumn was "unlawful" and "fraudulent" because they were not first offered to them. However, CRH has defended the acquisition, arguing that because the stake was acquired through the purchase of holding companies, the pre-emption clause did not apply. - (Additional reporting: Reuters)