TheChek News Flow

Germany-based industrial gas giant Linde Group [ETR:LIN] is seeking to receive revised offers for the sale of its Korean arm Linde Koreafor the last time by the end of February, sources familiar with the situation said.

The sell-side has been pushing three remaining suitors Macquarie Korea Opportunities Management, IMM Private Equity and France-based Air Liquide [EPA:AI] to improve their offers for the unit, after collecting binding bids in December, the sources said.

IMM PE, Macquarie Korea, US-based TPG Capital and Air Liquide placed binding bids in mid-December but TPG Capital has dropped out of the process since, previous media reports said. The Deutsche Bank-advised deal reportedly received binding bids of over KRW 1tn (USD 900m).

Linde Korea’s EBITDA in 2017 was about KRW 105.1bn, with an adjusted EBITDA of around KRW 80bn, as reported. The company posted KRW 312.4bn in sales and KRW 44.7bn in operating profit in 2017, up 16% and 21.8%, respectively, year-on-year.

Linde Korea's earnings have increased in 2018, one of the three sources said.

The Korean asset was put up for sale to comply with a regulatory requirement and was moving forward to meet the deadline for deal completion at April-end 2019, this news service reported in December 2018.

Linde’s Korean asset sale should close within six months from the completion date of its merger with the Connecticut-based industrial gas supplier Praxair, according to an officer at South Korea’s antitrust watchdog the Fair Trade Commission (FTC). This deadline can be extended by six months upon request and with regulator approval, but has not been extended yet, the officer added. Linde will face a compulsory penalty if it fails to complete the sale by the deadline, he noted.

The merger of Linde and Praxair, which was announced in June 2017, was completed on 31 October 2018, according to Mergermarket data.

The FTC asked Linde and Praxair to divest assets in the country ahead of their proposed merger, according to a regulatory statement on 2 October 2018. Linde and Praxair jointly have more than a 40% share in the South Korean market for the supply of nitrogen, oxygen, and argon, and their merger could lessen market competition, it noted.

Linde Korea sells a range of industrial gases such as oxygen, nitrogen, argon and acetylene with manufacturing facilities in Pohang, Seosan, and Giheung in South Korea.

Linde, Linde Korea, Macquarie and TPG declined to comment. Air Liquid and IMM PE did not respond by the time of publication.