Linde bosses confident of merger with Praxair
Chairman prepared to push through deal even if German workers vote against it
Both the chief executive and the chairman of German chemicals group Linde insist the planned $65bn merger with US rival Praxair is on track to be signed before the company’s shareholder meeting next month.
Despite opposition from group worker representatives, both chief executive Aldo Belloni and chairman Wolfgang Reitzle have expressed confidence the deal will go ahead before the May 10 meeting.
In the event that the workers’ side oppose the deal, Mr Reitzle has said he is willing to push the deal through by casting his double vote in favour of it. “Yes I’m willing to do that,” he said.
The prospect of the deal going through was called into question last week when Linde’s European works council called the planned merger “a demolition which will destroy Linde’s brand essence”.
The council said it worried about “a significant number of job losses” and the fact that the new operational headquarters would be in Connecticut, where Praxair is based.
The merger must be approved by Linde’s supervisory board, which by German law is split equally between shareholder and worker representatives.
A potential deal between the two companies has collapsed once, in September, owing to internal disputes over personnel, the role of Linde’s Munich headquarters and other details.
The collapse led to the ouster of Linde’s top executive and its finance chief, as well as to a €370m cost-savings plan.
Talks resumed in November when Praxair chief executive Steve Angel pledged to give more support to German workers, leading to job guarantees through 2021.
When preliminary terms were signed in December, worker representatives unanimously supported it — a big win for Mr Belloni, 67, a 35-year Linde veteran who emerged from retirement to take the chief executive role in December.
Mr Belloni has since his expressed his annoyance at the newfound labour unrest, which has provoked questions from Praxair and forced him into cumbersome conversations about German co-determination laws that grant workers influence in dealmaking. But he rejected any idea that the merger was in doubt.
“[Workers] are expressing critical comments,” he told the FT on Friday. “I find it surprising because they were unanimously on board before Christmas. I assume there has been inspiration from the unions.”
Mr Belloni said there have been discussions about Praxair’s Mr Angel coming to Germany to hold a town hall-style meeting with workers just before a formal merger is drafted, but the hope is that this is not necessary.
He said he is in “constant” and “challenging” dialogue with employees, but that his role is to provide better communication to workers about the deal, not to grant further concessions.
Linde employs 65,000 people in more than 100 countries, with just 11 per cent of them in Germany. Mr Belloni has previously said that while the deal seeks $1bn in synergies, the savings would not come at the “cost and detriment of the German workforce and locations”.
Linde’s supervisory board is scheduled to meet next Thursday, giving a chance for Mr Reitzle, who is set to retain his chairman role at the enlarged group, to smooth workers’ concerns.