Air Products today announced an agreement to divest the majority of its Canadian packaged gas business to the BOC Group. Closing would follow receipt of applicable Canadian regulatory approvals.
According to a statement, the transaction would have no impact on Air Products’ other Canadian businesses, such as tonnage/on-site, merchant liquid bulk, electronic specialty gases, liquid helium or its packaged gas businesses outside of Canada.
The divestiture would include 24 branch locations, four plants and one corporate office. These facilities cover four provinces and territories associated with the filling and distribution of cylinders, tube trailers and other containers of industrial gases and non-electronic specialty gases, including customer service centres, warehouses, office space, and other related assets.
Air Products will receive CAD$60 million (US$40 million) in cash with an additional CAD$5 million (US$3.3 million) that could become payable if certain performance conditions are achieved over the next three years.
Air Products will retain its manufacturing and distribution capabilities to serve liquid oxygen, nitrogen, argon and hydrogen merchant and on-site customers in Canada and the northern markets of the United States from its facilities in Sarnia, Ontario, Saint-Augustin-de-Desmaures, Quebec, and Nanticoke, Ontario as well as its customer-dedicated service facilities in Ontario and Quebec.
‘The proposed divestiture is the most recent example of how we are working to improve the mix and value of Air Products’ core business portfolio,’ said Robert E. Gadomski, executive vice president of Air Products’ Gases & Equipment Group.
Mr. Gadomski explained that the proposed sale would enable Air Products to divest a business in which it currently holds a small market share.
‘We will look to redirect resources and focus on our growth platforms where we’ve built core competencies and leadership positions,’ he said.