French company Air Liquide International has struck a deal to sell its Trinidad & Tobago business to Massy Holdings Limited, which is acquiring 100 per cent of the shareholdings for US$51.5 million to US$58 million.
Massy said the higher-end of the price range is subject to an earn-out agreement, payable annually, under specified conditions. Earn-outs generally relate to additional compensation to a seller if the business hits particular financial targets.
The deal signed November 28 still requires regulatory approval from the Trinidad and Tobago Fair Trading Commission.
The Massy group has five main operating segments – retail, gas products, motor and machines, financial services and real estate. The gas segment earns revenue from liquefied petroleum gases, and industrial gases such as nitrogen, oxygen and carbon dioxide. The segment also engages in the build-out of oil projects for gas and mining clients.
In Trinidad, Air Liquide makes and supplies oxygen, nitrogen and argon gases to commercial clients. The 30 workers it employed there will be integrated into Massy Gas, the French company said.
“This transaction is part of Air Liquide’s strategy to regularly review its asset portfolio and focus on selected fast developing areas and activities,” it said in a press release.
Air Liquide International operates in 75 countries with over 66,400 employees. Its revenue amounted to more than EUR23 billion in 2021. The company sees its future in renewables and is bullish on investment opportunities, having pinpointed opportunities in Latin America for its “clean energy transition”, including hydrogen.
“In this context, the group has decided to invest EUR1.1 billion this quarter, notably in electronics and in projects that contribute to the fight against climate change,” said Air Liquide in reference to the period ending December.
“The robust and diversified investment, currently running at EUR3.4 billion, is particularly promising for future growth,” the company said.
Massy Holdings, which has been in the process of divesting non-core and other assets that don’t fit within its long-term goals, said the Air Liquide deal aligns with the Massy Gas core operations.
The conglomerate said the acquisition would grow group profit by about three per cent and assets by 11 per cent.
At year ending September, Massy Holdings made a profit of TT$723 million and held assets of TT$12.7 billion.
For the gas products portfolio, the acquisition is expected to increase its pretax profit by 14 per cent.