$87bn deal to create world’s largest gas distributor hits snag

US REGULATORS have demanded extra disposals before they approve Praxair’s planned merger with its German rival Linde in an unexpected move that could derail the $87bn (£67bn) merger of the two industrial gas producers.

The Federal Trade Commission has “expressed expectations with regards to further divestiture commitments and prospective purchasers which are considered required for a merger clearance”, Linde said.

The two companies agreed an allshare merger in December that would create the world’s largest gas distributor, overtaking France’s Air Liquide.

However, the pair agreed at the time that if regulators demanded the disposal of businesses with more than $3.7bn in sales or $1.1bn in underlying profits, either party could withdraw without penalty.

Based on its discussions with the FTC and other anti-trust regulators, it said there was now a higher probability that the two companies would need to commit to selling assets exceeding the agreed threshold.