DUBLIN (Reuters) - Irish building materials group CRH launched its first share buyback programme in a decade on Wednesday and also announced a new target to raise 1.5-2.0 billion euros from selling assets.

CRH said last year it would prioritise reinvesting capital in acquisitions but chief executive Albert Manifold floated the possibility of a share buyback in a media interview on Friday, sending its shares 4.1 percent higher.

Manifold said on Wednesday the world's third-largest building group could do both, and would repurchase up to 1 billion euros of shares over the next 12 months, with the timing based on an ongoing assessment of capital needs.

"Our strong balance sheet and cash flow generation provides us with this opportunity to return excess cash to shareholders, while at the same time continuing to invest in our business and execute our strategic growth initiatives," he said in a statement.

"This repurchase programme demonstrates management's confidence in the outlook for our business, our continued strong cash generation and our flexibility to deliver value to shareholders."

Big spending CRH, which committed almost 5 billion euros to acquisitions last year, has also been quick to sell any business it deems to no longer meet its returns criteria and its new medium-term divestment target followed the completion of disposals worth 2.3 billion euros in the first quarter.

CRH's year-on-year sales fell by 2 percent in the first quarter due to the timing of Easter holidays and prolonged winter weather conditions in Europe and North America, where it is the biggest producer of asphalt for highway construction.

It also managed to increase prices in eight of the European countries it operates in, which analysts at Davy Stockbrokers said was particularly encouraging.

CRH said it expected earnings in the seasonally less significant first half to be in line with last year and ahead in the second half, provided there are normal weather patterns.

(Reporting by Padraic Halpin; Editing by Mark Potter)