Air Liquide has today announced that it has entered into an agreement to sell certain assets in the US to Matheson Tri-Gas, Inc. (MATHESON), a subsidiary of Japanese Tier One player Taiyo Nippon Sanso Corporation (TNSC).
Upon closing, these divestitures to Matheson would mark a significant milestone toward satisfying the conditions required by the US Federal Trade Commission (FTC) in connection with Air Liquide’s recent game-changing acquisition of Airgas.
Air Liquide completed the $13.4bn acquisition of Airgas, Inc., on 23rd May, a deal which creates comfortably the biggest industrial gas group in the world while also establishing Air Liquide as the largest player in the North American market.
Globally, the combined businesses will generate annual sales of more than €20bn (over $22bn), employ approximately 68,000 people around the world, and serve well over three million customers and patients.
Under the conditions of the deal, however, first announced and unanimously approved by each company’s Board of Directors in November 2015, the FTC stipulated the sale of certain assets to be satisfied within four months of closing the acquisition. A divestiture package was prepared, with Air Liquide confirming that the contemplated divestitures were in line with its expectations and will reduce the combined company’s sales by approximately $270m annually.
The company confirmed today that MATHESON will acquire the following assets from Air Liquide
In addition, Air Liquide is currently in negotiations to sell two of its facilities in Iowa that produce both liquid carbon dioxide and dry ice, which are the remaining assets ordered by the FTC to be divested in connection with Air Liquide’s acquisition of Airgas.
Michael J. Graff (pictured left), Member of the Air Liquide Group’s Executive Committee and Executive Vice-President for the Americas, said in a statement, “We are pleased to have found a strong and qualified buyer for these assets, and are continuing to focus on the successful integration of our other operations in the US with Airgas to deliver even greater value and service for customers, and contribute to the long-term profitable growth of Air Liquide.”
Yujiro Ichihara, President and CEO of TNSC, added, “This acquisition is consistent with Taiyo Nippon Sanso’s focused strategy to expand our presence in the US market. It represents the largest acquisition in the TNSC group history and extends our plant network throughout the US. By enhancing our position in the East and Midwest we will further solidify MATHESON as a national supplier.”
“This acquisition is consistent with Taiyo Nippon Sanso’s focused strategy to expand our presence in the US market. It represents the largest acquisition in the TNSC group history and extends our plant network throughout the US…”
Meanwhile Scott Kallman, MATHESON President and CEO, enthused, “We are very excited to welcome the employees of the acquired operations to the MATHESON Team and we will work together to deliver our new customers excellent levels of service.”
“This acquisition clearly supports our vertical integration strategy. Customers and future customers in these geographies will have access to our full product line of cylinder gases, bulk liquid, dry ice, related equipment and services, and the value this offering can provide to their businesses.”
gasworld Business Intelligence had previously analysed both the acqusition of Airgas and, last month, the necessary divestments across the US. After taking into account the required divestitures, it identified a US market leadership position of just under 28%, five percentage points more than fellow Tier One player Praxair, Inc. gasworld Business Intelligence valued the US commercial industrial gases market at just under $20bn in 2014, with Air Liquide and Airgas then holding market shares of 14% and 15%, respectively.
The MATHESON transaction and the sale transaction for the Iowa plants remain subject to FTC approval and are expected to close in the third quarter of this year.