IMM buys Linde's Korea gases business for $1.2b

The deal was triggered by Linde’s $86 billion merger with Praxair, which created a worldwide leader in the industrial gases space. Various regulatory agencies made divestments a condition for antitrust approval, which saw a Japanese strategic player pick up Praxair’s European business and CVC Capital Partners acquire Linde’s North American assets, in addition to the Korean transaction.

Korea-based operations being sold include gas plants in Giheung, Pohang and Seosan that serve customers on-site or make bulk distributions by tanker, as well as on-site oxygen and nitrogen generators. The business generated annual sales of approximately $220 million and EBITDA of just over $83 million in 2017, according to a statement. Linde also produces specialty and medical gases, but these assets do not appear to be part of the IMM transaction.

Linde entered Korea in 1988 with the construction of the Pohang site. Over the past 10 years, it claims to have invested EUR300 million in industrial gases production facilities and equipment. In 2016, the company acquired a portfolio of assets from Air Liquide, which was the top industrial gases player globally prior to the Linde-Praxair merger.

According to Gasworld Business Intelligence, Linde was the fourth-largest industrial gases provider in Korea in 2017 with a 13% market share. Praxair ranked third with 13%. The two leaders were Air Products and Daesung Industrial Gases with 24% and 22%, respectively. In 2017, Daesung was acquired by MBK Partners for KRW887 billion ($762 million). The deal was reportedly worth approximately KRW2 trillion, including debt.

IMM is currently raised its fourth fund, which launched last year with a target of $1.5 billion and has so far received commitments of around $1 billion. The firm’s previous vehicle closed at $1.16 billion in 2016.

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• Topics
• North Asia
• Buyouts
• Industrials
• South Korea
• IMM Investment