CRH, the global building materials group, could spend almost €4 billion acquiring new businesses over the next two years as it reinvests funds from the sale of its US distribution arm.

The Dublin-headquartered company yesterday announced the sale of its Americas distribution business to Beacon Roofing Supply for $2.63 billion (€2.23 billion) in cash, saying that it would use the proceeds to fuel further expansion elsewhere.

€600 million has already been used to acquire Fels, a German lime and aggregates business. CRH spent a further €630 million on smaller acquisitions in the first six months of the year.

Albert Manifold, the group chief executive, said the deals demonstrated CRH’s ability to add value for shareholders. He said the company had decided to sell off the US business after a fundamental shift in the industry in recent years.

“The industry started to change about five years ago after the crisis . . . larger businesses started consolidating the industry at prices that we really felt we couldn’t afford to pay and create value for our shareholders.

“The investment thesis had changed because the [industry] fragmentation was gone, it became very consolidated and very expensive. We decided we would sell at a price of 16 times earnings which is a very strong price. Quite frankly it was a price that we felt would be significantly in excess of what we could generate for our shareholders in the years ahead.

“What we’re going to do is take that money off the table and reallocate it back across CRH for better opportunities for growth and returns for our shareholders,” he said.

Fels was a business that CRH had looked to acquire three or four times previously over the past 20 years, he said, adding that it fitted “very well” within its existing lime business in Ireland, Britain and Poland.

“There are significant synergies for us and it positions us very well in this market,” he said.

Senan Murphy, the group finance director, said CRH expected to spend up to €3 billion on acquisitions over a two year period from the beginning of 2017.

Once the €2.2 billion sale of its US distribution business and €1.23 billion spend on acquisitions so far this year was accounted for, CRH’s acquisition “war chest” had been boosted by another €1 billion or so, he said.

“We’re obviously actively working through the pipeline. You need to be patient in terms of how these come through but we’re actively looking at opportunities and we’ll see how they play out,” he said.

A note by Davy, the Dublin stockbrokers, said CRH’s disposal was “in line with its strategy of recycling capital into higher-returning business”.

CRH reported a 27 per cent increase in pre-tax profit from €407 million to €517 million for the first half of 2017.

Revenues grew from €12.69 billion to €12.99 billion while earnings increased by 5 per cent to €1.18 billion.

Mr Manifold said the company’s financial performance was “satisfactory” with sales up 1 per cent and 3 per cent in Europe and the Americas, respectively.It continued to struggle in Asia, however, where sales fell by 8 per cent.

The company’s basic earnings per share rose by 29 per cent to 43.5 cent while the board increased the interim dividend by 2.1 per cent to 19.2 cent per share. CRH’s London-listed shares rose 103p, or 3.8 per cent, to £27.93.