Linde plc today said it had completed certain required divestitures in the US and it will now fully integrate its business globally.
As of today (1st March), the restrictions under the hold separate order issued by the US Federal Trade Commission have been lifted on the newly incarnated company.
Linde and Praxair announced the successful completion of their business combination back in October (2018).
The deal changes the face of the industry for the second time in recent years, following Air Liquide’s mega acquisition of fellow Tier One company Airgas in 2016.
Reflecting on today’s announcement, gasworld’s Global Managing Editor Rob Cockerill said, “This is it, the moment we’ve been waiting for – from here, the circle of the mega-merger of Praxair and Linde into the newly formed Linde plc is complete. After the whirlwind of the merger process over the last two and a half years and its completion on paper back in October, this is essentially the next big step for Linde plc.”
“This $90bn merger has faced a number of hurdles along the way, some will say rightly so and others might argue rather harshly, but all of those challenges have been met and with the completion of the final divestments announced in the last few days, Linde plc is now able to move forward with its full integration globally – and officially become the largest play in the industrial gases business worldwide.”
“Hats off not only to all of those involved in delivering this milestone merger, but also those taking the opportunity to grow their footprints with the divested operations on offer. A new leader is crowned globally, and a new industrial gas landscape is carved in Europe and the Americas.”
The $90bn merger of Praxair and Linde creates a combined entity that usurps Air Liquide as the leading force of the global gases business. gasworld Business Intelligence previously estimated a combined market share of 33% pre-divestment.
Based on 2017 reported results, the combination will create a company with pro forma revenues of approximately $27bn, and a market capitalisation of approximately $90bn.
The combined company is set to enjoy strong positions in all key geographies and end markets, and create a more diverse and balanced global portfolio, while approximately $1.2bn (€1.1bn) in annual synergies are to be achieved over the next three years, driven by scale benefits, cost savings and efficiency improvements.
gasworld’s Senior Business Analyst Jonny Dearden gave some insight into how the market will change post merger:
“From now onwards, we can expect to see the market change in Europe as TNSC takes a 10% market share In Europe. The European Commission was particularly tough on the merging companies as they mandated that the businesses in UK/Ireland, the Benelux, Spain/Portugal and the majority in Germany were sold off. Not only this was done, but the European Commission also mandated an untangling of the Italian businesses that Praxair had with SIAD – namely Rivoria and SIAD itself. The result was that the European business of Praxair was sold off to TNSC and renamed Nippon Gases. This also resulted in the total independence of SIAD as well.”
“Messer’s return to North America follows their acquisition of Linde assets in the US and Canada. This will result in Messer holding an overall North American market share of around 14%, making them the 4th largest player active in the North American market.”