Linde, Praxair to Focus on U.S. Asset Sales in Antitrust ReviewBy
German and U.S. companies reached final accord for tie up
Executives are in Munich on Friday to unveil their plans
Linde AG and Praxair Inc. will zero in on U.S. operations for possible asset sales as part of the industrial gas suppliers’ efforts to get their $35 billion combination approved by antitrust regulators.
“The U.S. will clearly be the largest market that will be reviewed with divestitures, and we’ll work through that process with the Federal Trade Commission,” Praxair Chief Executive Officer Steve Angel said on a conference call Friday with reporters. “Obviously our objective is to minimize divestitures.”
Munich-based Linde and Praxair, which has headquarters in Danbury, Connecticut, signed on Thursday a final agreement for their long-planned deal to become the world’s largest supplier of gases to factories and hospitals, ending months of suspense about whether the tie up would go through because of opposition from German employees. The transaction will face scrutiny from antitrust regulators amid a wave of industry consolidation. France’s Air Liquide SA completed its own transatlantic deal last year with its $13 billion acquisition of Airgas Inc. to create what is now the biggest industrial-gas supplier.
Authorities examining the Linde-Praxair agreement will look at every region individually, as the “industrial gas business is a local business,” Angel said on the call.
Linde shares rose 1.4 percent to 175.55 euros at 9:30 a.m. in Frankfurt, giving it a market value of 33 billion euros ($37 billion).
Billed as a merger of equals, the companies have worked out a balance that appears delicate geographically as well as in terms of the make up of the board and top management.
The new company, which will carry Linde’s name, will see Angel keep his current CEO role, while Linde’s chairman of the supervisory board Wolfgang Reitzle will also keep that position, with the rest of the board made up of directors coming equally from two companies.
The new holding company will be incorporated in Ireland and board meetings will be mostly be held in the U.K., Linde has said. Corporate functions will be split between Munich and Danbury.
Within the new company, Linde’s Christian Bruch will lead engineering, Bernd Eulitz will lead the Europe, Middle East and Africa markets and Sanjiv Lamba will head the Asia-Pacific market, Angel said. Praxair’s Matt White will be chief financial officer.