- Michaela Rehle/Reuters
Linde and Praxair, two of the world’s largest industrial gas companies, announced a merger on Tuesday.
The combined company will have an enterprise value of $65 billion and be the biggest industrial gas company, according to a release from the companies.
Praxair is a Danbury, Connecticut-based US company that says its mission is “making our planet more productive.” Praxair CEO Steve Angel will continue in that role at the combined company.
The deal will be an all-stock merger with Linde shareholders receiving 1.54 shares of the new company per share of Linde stock they hold. Praxair, an American company, shareholders will receive one share in the new company per share of Praxair stock. So the combined company will be made up of equal parts Linde and Praxair shareholders.
The newly combined company will be domiciled in Europe, according to the deal announcement, though CEO Angel will be based in Connecticut. The companies said:
“The new holding company would be formed and domiciled in a neutral member state of the European Economic Area (“EEA”), with the CEO based in Danbury, Connecticut USA. Corporate functions would be appropriately split between Danbury, Connecticut and Munich, Germany to help achieve efficiencies for the combined company.”
The new company will be called Linde and its stock will trade in New York and Frankfurt. According to the release, the companies expect to create $1 billion in annual synergies through the merger.
The deal is sure to be unpopular with some in the US. President-elect Donald Trump has advocated for bringing jobs back from overseas to America and lowering the corporate tax rate to draw companies back to the US.
The Linde-Praxair deal looks similar to a “tax inversion” deal, in which an American company merges with a foreign firm and moves its domicile overseas, allowing the combined company to take advantage of a lower tax rate while maintaining a large US operation.
President-elect Donald Trump has railed against companies leaving the US in the past, saying they “have no loyalty to this country.” Additionally, Stephen Moore, one of Trump’s economic advisers, specifically called out inversions as a point of emphasis for the new administration two days after the election.
Credit Suisse is advising Praxair on the deal, while Perella Weinberg Partners and Morgan Stanley are advising Linde.