Linde Stock Up As Boards Agree Merger With Praxair

(RTTNews) - Shares in Linde AG (LDE.L, LNAGF.PK) were gaining around 2 percent in German trading on Friday after the industrial gases producer's boards agreed a merger with U.S. peer Praxair Inc. (PX). The merger would create the world's biggest industrial gases group.

In a statement Thursday, the Munich-based company said it signed the deal following approval from its supervisory board. As per reports, Chairman Wolfgang Reitzle did not need to use his double vote to push the tie-up through.

In the prior year, a merger attempt was failed due to opposition from Linde employees, which led to the departure of Linde's two top executives.

It was in December last year that the two major players in the gas industry resumed their merger talks and announced their plan to combine in a merger of equals under a new holding company through an all-stock transaction.

On May 24, Linde and Praxair said that they have reached an agreement in principle on the Business Combination Agreement which governs the envisaged merger of equals between the two companies. The conclusion of the deal was partly subject to the approval by the Board of Directors of Praxair as well as the Executive Board and the Supervisory Board of Linde.

The deal still needs to be approved by a majority of Praxair investors at a shareholder meeting, while 75 percent of Linde shareholders must tender their shares to the new company for the merger to go through.

In a marathon supervisory board meeting on Thursday, Chairman Wolfgang Reitzle managed to stop labor representatives from blocking the deal, Reuters reported.

Praxair Chief Executive Steve Angel said he was confident that any anti-trust remedies imposed would be manageable.

Angel reportedly said, " You cannot be a leading industrial gas company unless you have a strong engineering and technology arm."

In Germany, Linde shares were trading at 176.45 euros, up 1.96 percent.