The Industrial Gases industry has been pre-dominantly characterized with high market concentration ratio with only about 5 major players controlling more than 70% of the market. The number of players came down to four when Air Liquide acquired Airgas earlier in 2016. Now, Praxair and Linde are exploring possibilities to merge. If this merger is accomplished, it will further reduce the number of major players to three. The combined company would have a global market share of about 40% and annual sales of close to $28 billion, making it by far the world’s largest gases firm. Such high market concentration will have adverse impact on the prices of industrial gases at a time when major buyers, especially in the oil & gas industry, are struggling to recover from oil price debacle. Further rise in concentration will definitely have antitrust authorities scrutinize the merger even more strictly. …show more content…
The last mega-deal was closed in May 2016, when Air Liquide acquired Airgas for $13 billion. The combined businesses will generate annual sales of more than $22 billion, employ approximately 68k people around the world, and serve well over 3m customers. The acquisition allows Air Liquide to expand in the U.S., the largest global market for industrial gases, and extends its customer base by more than one million. It will also benefit from the most advanced multi-channel distribution network in the U.S., including e-commerce and telesales capabilities. Air Liquide becomes the leader in North America, after having already clinched that spot in Europe, Middle East and Africa, and