Praxair headquarters in Burr Ridge, Illinois. Praxair Inc. is in discussions to combine with Germany’s Linde AG, people familiar with the matter said, in a major deal that would create the world’s largest industrial-gas supplier and continue a wave of consolidation in the industry. Details of the talks couldn’t be learned, and one person cautioned they are fragile and could fall apart.
If there is an agreement, there is also no guarantee antitrust regulators would approve it. A deal would combine companies each worth about $30 billion and rank as one of the largest tie-ups in a strong year for mergers. The news comes less than three months after two major rivals of the companies combined, setting off another possible wave of consolidation in an industry hit by declining energy prices and sluggish economic growth.
Air Liquide SA AI, -0.64{1c8721459c474d1d5b48ba9ae7120e36de45aa62207fb48292a0a282be55d27f} in May bought Airgas Inc. for about $10 billion, enabling the French company to reclaim the number one spot among makers of gases used in manufacturing, food production, health care and the like, with annual revenue of more than $23 billion. Munich-based Linde, which makes industrial and medical gases and builds plants for chemical producers and others, had taken the No. 1 position from Air Liquide with its $14 billion takeover of the UK’s BOC PLC in 2006. A combined Linde LIN, +0.30{1c8721459c474d1d5b48ba9ae7120e36de45aa62207fb48292a0a282be55d27f} and Praxair PX, -0.66{1c8721459c474d1d5b48ba9ae7120e36de45aa62207fb48292a0a282be55d27f} would again leapfrog Air Liquide, creating a company with more than $30 billion in revenue.