24 May 2006 15:25 [Source: ICIS news]
LONDON (ICIS news)--Investors have begun to take bets on whether regulatory approval for Linde’s £16/share bid for UK based industrial gases rival BOC will be delayed, financial analysts said on Wednesday.
If pre-conditions for the sale, which values BOC at £8.2bn ($15.4bn/€12.0bn) are not met by 31 May, BOC will be permitted to pay its shareholders an interim dividend that could amount to £0.27 per share. That would, in effect, raise the value of the deal by £139m.
A dividend amount of £0.03375/share will accrue for each complete seven day period from 1 June and ending either on 26 July or the date on which the pre-conditions of the sale are satisfied. The pre-conditions are regulatory approval from the European Commission (EC) and the US Federal Trade Commission (FTC).
A significant hurdle to the agreed bid approach is not expected but the companies portfolios overlap in ?xml:namespace>
It was not clear whether Polish anti-trust objections would delay the European Union competition authorities in reaching a decision on the bid approach. A EC competition directorate spokeswoman could not comment on the progress of its investigation but said a decision was planned for 6 June.
A short delay in regulatory approval would not make a material difference to the £8.2bn bid approach, analysts said, but the prospects of a delay had excited hedge fund and other investor interest.
As a combined gas and engineering group Linde would have annual revenues of approximately €12bn. Linde has said it would finance the transaction by a mix of equity, debt and disposals, and was aiming for closing in the third quarter.
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