Praxair in talks acquire Linde: source

Praxair in talks to acquire Linde: source

6:22 AM, 16th August 2016
Praxair in talks to acquire Linde: source
Linde AG head office in Munich, Germany. (File photo)

DANBURY, US/ MUNICH, GERMANY: Praxair Inc is in talks to acquire German’s company Linde AG and create the biggest company in their sector with a market value of more than $60 billion, a person familiar with the matter said.

Such a deal would underscore the wave of consolidation sweeping the industrial gas sector, as slower economic growth has weakened demand in the manufacturing, metals and energy sectors and put pressure on smaller players to compete.

A combination of Praxair and Linde would also test the tolerance of regulators for more transformative deals in a year that other mega-deals, such as US oilfield services provider Halliburton Co's $34.6 billion acquisition of Baker Hughes Inc, were shot down due to antitrust concerns.

Details of the talks, which were first reported by the Wall Street Journal, were not immediately clear and any potential deal could still fall apart, according to the source.

The source spoke on condition of anonymity because the talks were confidential. Representatives for Danbury-based Praxair and Germany-based Linde could not be immediately reached for comment.

The deal would represent a serious challenge to France's Air Liquide, which acquired US peer Airgas Inc earlier this year for $10.3 billion in a bid to expand into the US, the largest market for industrial gasses.

Praxair is an industrial gas supplier in North and South America, Asia and Europe, while Linde Group's core business offers planning, project development and construction of turnkey industrial plants used in fields, such as petrochemical and chemical industries.

In April, Praxair, not known for attempting large acquisitions, bought five small industrial gas businesses, which had combined 2015 annual sales of more $40 million.

When Air Liquide and Airgas merged, analysts pointed out that the deal would help Air Liquide overtake rivals including Linde AG, Air Products and Praxair. Air Liquide was also able to secure a spot in the North American market and speed diversification away from slow-growth in Europe.

© Reuters News



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