Acquisitions

3 Months Ended

Mar. 31, 2024

Business Combination and Asset Acquisition [Abstract]

Acquisitions

4. Acquisitions

The Company strategically acquires companies in order to increase its footprint and offer products and services that enhance its existing offerings. These acquisitions are accounted for as business combinations using the acquisition method, whereby the purchase price is allocated to the assets acquired and liabilities assumed, based on their estimated fair values at the date of the acquisition with the remaining amount recorded in goodwill.

On February 9, 2024, the Company acquired a portfolio of cement and readymixed concrete assets and operations in Texas, United States (the 'Hunter' acquisition) for a total consideration of $2,106 million.

During the three months ended March 31, 2024, the Company completed the acquisition of eight companies, each individually immaterial except for the aforementioned Hunter acquisition in the Americas Materials Solutions segment. The total cash consideration for these acquisitions net of cash acquired, was $2,206 million. The estimated fair values of assets acquired and liabilities assumed are provisional and are based on the information that was available as of the acquisition dates. The Company expects to finalize the valuation and complete the purchase price allocations as soon as practical but no later than one year from the acquisition dates.

The provisional amounts for assets acquired, liabilities assumed, and consideration related to the acquisitions at March 31, 2024 were:

in $ millions	Hunter	Other acquisitions (i)	Total
Identifiable assets acquired and liabilities assumed
Accounts receivable, net	-	6	6
Inventories	71	1	72
Other current assets	2	2	4
Property, plant and equipment, net	1,075	38	1,113
Intangible assets, net	2	18	20
Operating lease right-of-use assets, net	12	19	31
Accounts payable	-	3	3
Accrued expenses	5	3	8
Operating lease liabilities	12	19	31
Long-term debt	-	(2)	(2)
Deferred income tax liabilities	-	1	1
Other liabilities	8	14	22
Total identifiable net assets at fair value	1,137	46	1,183
Goodwill	969	56	1,025
Total consideration	2,106	102	2,208
Consideration satisfied by:
Cash payments	2,106	100	2,206
Deferred consideration (stated at net present cost)	-	2	2
Total consideration	2,106	102	2,208
Acquisitions of businesses, net of cash acquired
Cash consideration	2,106	100	2,206
Total outflow in the Condensed Consolidated Statements of Cash Flows	2,106	100	2,206

(i) Other acquisitions are aggregated on the basis of individual immateriality.

As a result of the 2024 acquisitions, the Company recognized $20 million of amortizable intangible assets and $1,025 million of goodwill. Goodwill represents the excess of the consideration paid over the fair value of net assets acquired and includes the expected benefit of cost savings and synergies within the Company’s segments and intangible assets that do not qualify for separate recognition. Of the goodwill recognized in respect of the acquisitions completed in the three months ended March 31, 2024, $980 million is expected to be deductible for tax purposes. The amortizable intangible assets will be amortized against earnings over a weighted average of eight years.

There have been no other acquisitions completed subsequent to the balance sheet date which would be individually material to the Company.

Acquisition-related costs

Acquisition-related costs have been included in Selling, general and administrative expenses in the Condensed Consolidated Statements of Income. These costs include legal and consulting expenses incurred in connection with acquisitions completed during the applicable period. The Company incurred the following acquisition-related costs:

	Three months ended
	March 31
in $ millions	2024	2023
Acquisition-related costs
Hunter	20	-
Other acquisitions	-	2
Total acquisition-related costs	20	2

The financial information regarding the acquisitions included in the Company’s Condensed Consolidated Statements of Income from the date of acquisition through March 31 were:

in $ millions	2024	2023
Revenue	57	20
Net income (loss) attributable to CRH plc (i)	9	(1)

(i) Net income (loss) amount excludes substantial acquisition-related costs that arose during the three months ended March 31, 2024, and March 31, 2023.

Pro forma results of operations for the acquisitions have not been presented because they are not material to the Condensed Consolidated Financial Statements.