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Is BOC Edwards up for grabs? |
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Mar 09, 2006 at 06:25 PM |
The news this week that BOC is to be acquired by the German chemicals company Linde for £16 pounds a share—a 40 percent premium to the current stock price didn't surprise me, as the Linde CEO Wolfgang Reitzie made it clear that his company was very strong in Germany while BOC was strong in many other parts of the world.
What was a little surprising and something I haven't seen the mainstream press cover is that Reitzie said he wanted to concentrate on the chemical aspects of the new combined company so divisions such as BOC Edwards could well be spun-off or put up for sale.
Speaking to a media representative at BOC, he confirmed that the Linde board would be considering what to do with the now "non-core" businesses that indeed includes BOC Edwards.
Several times in previous years BOC investors have pushed the company to spin-off Edwards as it was responsible for heavy losses for the group when the semiconductor industry goes through a down-cycle. Of course one of the reasons the company stayed with Edwards was the fact that in an upturn it was responsible for a significant boost in earnings.
I am sure that the speculation as to the fate of Edwards will start soon and that there will be some interested parties in the industry taking a look at the business. Applied Materials is the first to spring to mind as it has bought Metron and wants more "services" revenues, however I would expect the potential buyers list to grow quite large!
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