Linde-Praxair Deal to See Close Scrutiny at FTC

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By Alexei Alexis

Industrial gas giants Linde AG and Praxair Inc. are responding to in-depth questions from the Federal Trade Commission about their merger plans, the companies disclosed in a U.S. regulatory filing.

Linde and Praxair have received a “second request” from the FTC, a formal step in the merger review process requiring parties to divulge significant amounts of data to regulators. Such investigations can go on for months. Responses are in progress, the companies said in their Aug. 28 filing.

The companies said they still expect to close the deal by the second quarter of 2018.

FTC spokeswoman Betsy Lordan declined to comment.

Linde reached final agreement in June for a $35 billion tie-up with Praxair that would create the world’s largest supplier of industrial gases. The combined entity would outrank current market leader Air Liquide SA, which merged with Airgas Inc. in 2016 for $13 billion. The remaining players in the market have less than half the market position of either Linde or Praxair, according to Bloomberg Intelligence.

The Linde-Praxair deal is subject to review by antitrust authorities in about 24 jurisdictions, the companies said.

The parties are engaged in a “pre-notification” phase with the European Commission. Other jurisdictions that will take a look at the merger include China, India, South Korea, Brazil, Canada, Mexico, and Russia.

The parties anticipate working closely with the FTC to find remedies to allow the merger to go through. Praxair CEO Steve Angel told reporters on a June 2 conference call that the largest divestitures will probably be in the U.S., and that he expects the EU or the U.S. to be the “two lead jurisdictions that many other regulatory authorities will follow.”

“The Americas would represent 43 percent of total sales prior to any divestitures, and North America would be a bit more than one-third of the total company,” agreed Linde CEO Aldo Belloni on the same conference call.

To contact the reporter on this story: Alexei Alexis in Washington at aalexis@bna.com

To contact the editor responsible for this story: Fawn Johnson at fjohnson@bna.com

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