Linde has confirmed that its CEO and CFO will each leave the company following the collapse of discussions to merge with US rival Praxair.
CFO Georg Denoke exits Linde effective immediately and CEO Wolfgang Büchele has said he will not renew his contract when it expires in April 2017. Sven Schneider, until recently head of group treasury, will serve as interim CFO until Linde has appointed a successor to Denoke.
Linde announced yesterday that talks with Praxair had been abandoned after shareholder representatives on the supervisory board of Linde, with the agreement of Büchele, had recommended that the management and supervisory boards terminate the talks. Reports say that Denoke, who joined Linde in 2004, and Linde trade union representatives—including those on the supervisory board—strongly opposed the deal and contributed to its collapse.
Büchele, in a letter to Linde employees, quoted by Bloomberg, says the deal foundered on uncertainty surrounding Linde’s Munich, Germany base after the companies decided to headquarter the merged company in Europe outside Germany and locate the operational center at Praxair’s Danbury, Connecticut headquarters. “One focus for us was our traditional location in Munich, which for us would have been of central importance in the merged company,” the letter reportedly says. “A merger would mean achieving a balance between Linde and Praxair on the new company’s structure and headquarters. That point was non-negotiable for me and the other members of the executive board.”
Other reports say that Praxair CEO Stephen Angel would have been CEO of the merged company and that Denoke would not have been CFO. “We suspect inability to agree on the share-exchange ratio played a role too,” says Noelle Guo, analyst at Bernstein (London). Another news report cites tensions that had been building for some time between Büchele and Denoke. Linde has declined to comment on the reports.
Combining Linde and Praxair would have created the biggest player in industrial gases with combined revenue of more than $30 billion/year.
By Ian Young
Source: Chemical Week
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