* Acquisition prospects in Asia white cement
* Cement group looks to expand waste management in Europe
* Italian market hit by collapse in cement demand
(Adds analyst quote, share reaction)
ROME, March 14 (Reuters) - Italy's Cementir group is looking at acquisition opportunities to strengthen its position in white cement and could finalise a deal within 12 months, possibly in Asia, chief executive Francesco Caltagirone said.
Cementir is the world leader in white Portland cement, a material used in decorative building work which has higher margins than standard grey cement. It is looking at prospects in the United States, sub-Saharan Africa and Asia, Caltagirone told Reuters in an interview.
"It's something which could be firmed up in the next 12 months," he said. "We're at quite an advanced stage and we're conducting checks at the moment."
After a billion-euro buying spree in the five years after its acquisition of Turkish unit Cimentas in 2001, the group has made few big deals since 2006 but a focus on improving profit margins and lowering debt has given it room to move.
"We could have a spending capacity above 500 million euros ($695.25 million). This could be spent on acquisitions or green- or brownfield investments," Caltagirone said.
He said prospects in the United States, while potentially interesting, were limited by high prices while a deal in sub-Saharan Africa, another area of interest, would only make sense if there were a well-structured company for sale.
But he said "there may be some opportunity" in Asia to complement the group's existing site in the eastern Chinese city of Anqing.
Cementir shares, which have rallied 144 percent over the past year, outperforming the overall sector, dropped sharply on Friday following Caltagirone's comments to Reuters and were down 5.72 percent at 1420 GMT. The FTSE Italia All-Share Construction & Materials Index was down 2 percent.
"It's a lot of money and that could have alarmed some people in the market, but I actually agree they have a solid balance sheet and they can afford a deal. The important thing is they have to be careful not to overpay," said Matteo Bonizzoni, an analyst at Kepler Cheuvreux in Milan.
"That hasn't happened in the past though and I remain positive," he said. "They've shown they can buy well at reasonable prices," he added, pointing to Cementir's 2004 acquisition of Aalborg Portland and Unicon in Denmark, which gave it the leading position in white cement.
However Bonizzoni was more cautious about waste management, a relatively new sector for Cementir, which is still loss-making. "Waste management is a different story. So far, it has been a disappointment because margins have been zero," he said.
Caltagirone said the group was looking at opportunities to expand its waste management operations to more European countries, aiming to lift the division's share of group revenues to around 15 percent over the medium term from around 4 percent at present.
Its waste business is currently focused in the north of England and in Turkey - where a local unit treats municipal rubbish in Istanbul and another industrial waste treatment unit operates near the city of Kula.
"We're continuing to invest in waste management - we want to expand in other European countries after the two sites in Turkey and the site between Manchester and Liverpool," he said.
However, he ruled out any investment in waste management in Italy, where a tangle of conflicting political interests, inefficient regulation and outright criminal abuse has created a seemingly never-ending crisis in cities like Naples and Rome.
"It's quite off our radar," he said.
Cementir is controlled by the Caltagirone family holding company, headed by patriarch Francesco Gaetano Caltagirone, one of Italy's richest businessmen who owns operations ranging from construction to the Rome daily newspaper Il Messaggero.
The group's global spread has allowed it to limit the impact from a collapse in demand in Italy, where the overall cement market has fallen from a peak of some 47 million tonnes in 2007 to around 21 million tonnes last year during the country's worst economic slump since World War Two.
It has steadily scaled back its operations at home, where, like rivals, it has piled up losses over recent years, closing kilns and converting production sites in Taranto and Arquata Scrivia into smaller grinding facilities.
"The truth is that in Italy there are 15 operators with a total capacity of 50 million tonnes in a market of 20 million," Caltagirone said, adding that a small recovery was possible but the market was likely to stay at no more than half its peak.
"I think we'll need 10 years to recover even part of it," he said.
(Editing by Susan Fenton)