£8.2bn German takeover for British gases group BOC
Gases giant BOC today became the latest historic manufacturer to fall into foreign hands after accepting an £8.2bn (€12bn) bid from German industrial conglomerate Linde.
BOC agreed to join forces with Linde and create the world’s biggest industrial gases supplier after receiving an offer worth £16 (€23) a share and setting aside concerns about possible intervention from regulators.
The bid represented an improvement on a £15 (€22)-per-share proposal that Linde tabled in January, which was rejected by BOC as too low.
BOC, which began life in 1886 when brothers Arthur and Leon Brin set up Brin’s Oxygen Company, employs 30,000 people and serves two million customers in more than 50 countries.
It generated sales of £4.6bn (€6.7bn) and underlying profits of £564.2m (€823m) in its last financial year.
The recommended takeover comes hot on the heels of other major deals for UK firms, including the £2.2bn (€3.2bn) acquisition of glass maker Pilkington and the £17.7bn (€25.8bn) purchase of mobile phone operator O2. Shipping icon P&O has been swallowed up by an overseas firm, while airports operator BAA is a bid target.
Wolfgang Reitzle, chief executive of Linde, said the benefits of a tie-up with BOC included the ability to offer customers a greater range of products and services.
He added: “We will have an even better entrance into the international fast-growing markets which will provide the basis for stable future earnings and cash flows.”
The combined group will have annual sales of around €11.9bn, with the regional strength of BOC in Asia complementing the footprint of Linde in Europe and South America.
Savings of around €250m a year have been identified by bosses and should be realised during 2009.
Mr Reitzle added that there were no “insuperable” competition concerns, even though BOC has previously admitted that it fears a repeat of the saga that followed an agreed £7bn (€10.2bn) takeover by rivals Air Liquide of France and Air Products of the United States six years ago. That deal was scuppered by American regulators.
Linde also revealed today that it is evaluating its “strategic options” for its unit making forklift trucks, which accounted for 38% of its sales last year. Disposing of the business would allow it to focus purely on gases and engineering.
