The German building materials group Heidelberger is understood to be the front-runner to buy the Scandinavian producer Scancem, in a deal worth in excess of £1.5 billion.

CRH has been linked with a bid for Scancem but now seems to be out of the running, although industry sources believe that CRH may be interested in bidding for any of the Scancem assets that Heidelberger might sell off after a successful acquisition.

Market sources said that Heidelberger and its advisers were working though the weekend to have an all-cash bid ready for the Skanska board meeting tomorrow. Skanska is one of the two major shareholders who control 72 per cent of Scancem equity, and who have been ordered by the European Commission to sell Scancem. The British group RMC is the main competitor to Heidelberger for Scancem.

CRH's main interest in Scancem is Castle Cement, the second biggest cement producer in the UK, and Finncementi, the biggest cement producer in Finland.