Linde Reaches Top Slot With BOC Purchase
March 6, 2006
In a deal valued at 8 billion pounds (11.7 billion euros or $14 billion) Wiesbaden-based industrial-gas maker Linde AG has struck a deal to buy UK rival BOC Plc, for 16 pounds per share.
"The board of directors of BOC intends to recommend BOC shareholders to accept the offer," Linde said in a statement. The German group said it would finance the deal via a capital increase of between 1.4 billion and 1.8 billion euros, and loans and hybrid capital of 1.2 billion to 1.6 billion euros.
Combo tops Air Liquide
Additional funding would also be raised via the sale of activities, Linde said, without providing further details.
A combination of Linde and BOC will create the world's biggest industrial gas maker, putting the group ahead of French giant Air Liquide.
"Linde and BOC are a perfect match," Linde Chief Executive Officer Wolfgang Reitzle said in a statement. "We will be able to offer our customers a significantly enlarged product range as well as comprehensive services, and we will be able to do so world wide."
Expected savings
A combination of Linde, the fifth-largest gases company, and Windlesham, England-based BOC, the No. 2, will overtake Air Liquide SA of France and create a group with 22 percent of the $53 billion global market.
BOC had earlier spurned a lower offer of 15 pounds per share, saying it undervalued BOC's growth prospects.
Linde said it expects the newly merged company to save 250 million euros annually by 2009, as it can demand better prices on raw materials and cut administrative costs.
The deal must still be approved by anti-trust authorities.