Super mergers and acquisitions change the pattern of the chemical industry

"Global Coatings Network News"

"Global Coatings Network News"

In recent years, a series of super mergers and acquisitions are changing the pattern of the chemical industry, especially in the three market segments of coatings, industrial gases and agrochemicals.

In recent years, a series of super mergers and acquisitions are changing the pattern of the chemical industry, especially in the three market segments of coatings, industrial gases and agrochemicals.

Different industries have different levels of integration.

In 2013, agricultural income fell sharply, and the profit of the agrochemical industry was greatly affected, and the agrochemical industry embarked on a road of integration.

Market participants said that after the five major agrochemical companies merged into three companies in 2015, in accordance with the requirements of antitrust regulators, the divestiture of related assets by these large companies has provided BASF and FMC with opportunities to obtain some attractive assets.

In the coatings industry, apart from Sherwin's acquisition of Valspar, the scale of integration in recent years has been relatively small.

"In the past 10-15 years, market consolidation has created a real giant in the coatings industry.

Coatings industry integration has been going on.

The reason why large acquisitions in the coatings industry are difficult to succeed is the complexity of this market.

Industrial gases: unprecedented concentration

In the industrial gas industry, super mergers and acquisitions have resulted in a substantial increase in industry concentration.
After Linde and Praxair completed the merger, three global industrial gas companies-France Air Liquide, Air Products of the United States and the combined Linde Praxair were formed.
These three giants will account for about 70% of the global market.
However, the relevant divestitures necessary for Linde Praxair to complete the merger may bring expansion opportunities to second-tier manufacturers.

In the industrial gas industry, super mergers and acquisitions have resulted in a substantial increase in industry concentration.
After Linde and Praxair completed the merger, three global industrial gas companies-France Air Liquide, Air Products of the United States and the combined Linde Praxair were formed.
These three giants will account for about 70% of the global market.
However, the relevant divestitures necessary for Linde Praxair to complete the merger may bring expansion opportunities to second-tier manufacturers.

The Linde-Plex company merger is seen as the last step in decades of integration in the global industrial gas industry.
IHS Markit estimates that Air Liquide, Air Products, Linde and Praxair currently account for 60% to 70% of industrial gas business.
Once the transaction is completed, it means that these three companies control about 2/3 of the global industrial gas market.
The concentration of this market is unprecedented, and the degree of participation in market competition decreases.

The Linde-Plex company merger is seen as the last step in decades of integration in the global industrial gas industry.
IHS Markit estimates that Air Liquide, Air Products, Linde and Praxair currently account for 60% to 70% of industrial gas business.
Once the transaction is completed, it means that these three companies control about 2/3 of the global industrial gas market.
The concentration of this market is unprecedented, and the degree of participation in market competition decreases.

Praxair Investor Relations Director Juan Pelaez said that the merger is expected to be completed in the second half of this year, and the regulatory approval process has entered the final stage.
In many countries around the world, large-scale business sales are required to obtain antitrust approval for the merger.

Praxair Investor Relations Director Juan Pelaez said that the merger is expected to be completed in the second half of this year, and the regulatory approval process has entered the final stage.
In many countries around the world, large-scale business sales are required to obtain antitrust approval for the merger.

Bala Suresh, director of specialty chemicals at IHS Markit, said that in the United States alone, more than $1 billion of business may be divested.
According to the merger agreement, if the EBITDA (EBITDA) of the assets to be divested exceeds 1.
1 billion euros/year (approximately US$1.
3 billion/year), or the asset sales exceed 3.
7 billion euros/year, Linde Praxair and Praxair may choose to terminate the merger.

Bala Suresh, director of specialty chemicals at IHS Markit, said that in the United States alone, more than $1 billion of business may be divested.
According to the merger agreement, if the EBITDA (EBITDA) of the assets to be divested exceeds 1.
1 billion euros/year (approximately US$1.
3 billion/year), or the asset sales exceed 3.
7 billion euros/year, Linde Praxair and Praxair may choose to terminate the merger.

Messer and CVC Capital Partners are cooperating to bid for some Linde Praxair assets.
Suresh said that Dayang Nikko is expected to bid for its European business with the Canadian Pension Plan Investment Committee.
Private equity firms KKR and Carlyle, as well as rivals Air Products and Air Liquide, are also looking at these assets.