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Praxair & Linde to Sell Assets for U.S. Antitrust Approval
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Praxair Inc. (PX - Free Report) and Linde AG have entered into an agreement to sell additional assets to a consortium of Messer Group GmbH and CVC Capital Partners. With this, the companies have moved a step ahead toward obtaining the U.S. antitrust approval, currently the major hurdle for the Praxair-Linde merger.
Previously, Praxair and Linde had agreed to sell U.S. assets of the former, worth $3 billion, to Messer Group — a German industrial-gas supplier — and CVC — a private equity group — in a bid to secure U.S. approval. However, the Federal Trade Commission (FTC) demanded to sell more assets which threatened to breach a limit set by the merger partners to cap the value of assets sold.
Although no official decision has been made, CVC and Messer Group received positive signals from the FTC for buying additional assets. Per the deal, Messer Group and CVC will buy three air-separation plants, a liquid-argon contract, a carbon dioxide facility and two depots, valued at about $200 million.
In June 2017, Praxair signed a business combination agreement with Linde. The $80-billion merger deal will create a leading industrial gas company, with a strong international presence, large customer base and solid financial flexibility. The transaction will combine Praxair’s efficient operating model, and Linde’s expertise in engineering and technology.
Notably, Praxair has taken positive approaches to address regulatory concerns with the merger, particularly in the European Economic Area. In sync with this, Praxair decided to sell its European assets to Taiyo Nippon Sanso.
In addition, Praxair and Linde have won anti-monopoly approval from Competition Commission of India (CCI). CCI has directed Linde India to sell its entire stake in Bellary Oxygen Company Pvt. Ltd, a plant at Bellary in Karnataka, and two cylinder-filling stations in Hyderabad and Chennai. Furthermore, Praxair has been asked to sell its three plants at Jamshedpur, and two cylinder-filling stations at Asansol and Kolkata. The companies continue to work diligently to close the merger in the second half this year.
Price Performance
Over the past year, Praxair has outperformed the industry with respect to price performance. The stock has gained around 19%, while the industry recorded loss of around 2% during the same time frame.
Celanese has a long-term earnings growth rate of 10%. The stock has rallied 10% in a year’s time.
Ingevity has a long-term earnings growth rate of 12%. Its shares have surged 78% in the past year.
Air Products has a long-term earnings growth rate of 16.2%. The company’s shares have been up 12% over the past year.
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Praxair & Linde to Sell Assets for U.S. Antitrust Approval
Praxair Inc. (PX - Free Report) and Linde AG have entered into an agreement to sell additional assets to a consortium of Messer Group GmbH and CVC Capital Partners. With this, the companies have moved a step ahead toward obtaining the U.S. antitrust approval, currently the major hurdle for the Praxair-Linde merger.
Previously, Praxair and Linde had agreed to sell U.S. assets of the former, worth $3 billion, to Messer Group — a German industrial-gas supplier — and CVC — a private equity group — in a bid to secure U.S. approval. However, the Federal Trade Commission (FTC) demanded to sell more assets which threatened to breach a limit set by the merger partners to cap the value of assets sold.
Although no official decision has been made, CVC and Messer Group received positive signals from the FTC for buying additional assets. Per the deal, Messer Group and CVC will buy three air-separation plants, a liquid-argon contract, a carbon dioxide facility and two depots, valued at about $200 million.
Praxair, Inc. Price
Praxair, Inc. Price | Praxair, Inc. Quote
In June 2017, Praxair signed a business combination agreement with Linde. The $80-billion merger deal will create a leading industrial gas company, with a strong international presence, large customer base and solid financial flexibility. The transaction will combine Praxair’s efficient operating model, and Linde’s expertise in engineering and technology.
Notably, Praxair has taken positive approaches to address regulatory concerns with the merger, particularly in the European Economic Area. In sync with this, Praxair decided to sell its European assets to Taiyo Nippon Sanso.
In addition, Praxair and Linde have won anti-monopoly approval from Competition Commission of India (CCI). CCI has directed Linde India to sell its entire stake in Bellary Oxygen Company Pvt. Ltd, a plant at Bellary in Karnataka, and two cylinder-filling stations in Hyderabad and Chennai. Furthermore, Praxair has been asked to sell its three plants at Jamshedpur, and two cylinder-filling stations at Asansol and Kolkata. The companies continue to work diligently to close the merger in the second half this year.
Price Performance
Over the past year, Praxair has outperformed the industry with respect to price performance. The stock has gained around 19%, while the industry recorded loss of around 2% during the same time frame.
Zacks Rank & Stocks to Consider
Praxair carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same sector are Celanese Corp. (CE - Free Report) , Ingevity Corp. (NGVT - Free Report) , and Air Products and Chemicals, Inc. (APD - Free Report) . While Celanese and Ingevity sport a Zacks Rank #1 (Strong Buy), Air Products carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Celanese has a long-term earnings growth rate of 10%. The stock has rallied 10% in a year’s time.
Ingevity has a long-term earnings growth rate of 12%. Its shares have surged 78% in the past year.
Air Products has a long-term earnings growth rate of 16.2%. The company’s shares have been up 12% over the past year.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>