CRH, the international building materials group, said it was in negotiations with Jaypee Cement Corporation to buy a stake in the Indian firm.
The Gujarat operation in the frame consists of a 3.6m tonne clinker plant at Kutch with 2.4m tonnes of cement grinding capacity.
It also includes a further grinding plant in eastern Gujarat with capacity to produce 2.4m tonnes of cement a year.
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Jaypee is the third largest cement producer in India with an annual capacity of 28.8m tonnes per annum.
The company has a market capitalisation in excess of 166.4bn rupees - € 2.45bn - and turnover of more than 138.3bn rupees (€ 2.03 bn).
CRH said completion of any transaction would be subject to satisfactory due diligence, the approval of the respective boards of directors and the granting of regulatory approval.
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