The Linde Group recently completed its acquisition of Lincare
Holdings Inc., a leading provider of oxygen and respiratory
therapies. Following the acquisition, Lincare has been incorporated
into Linde as a fully-owned subsidiary.
Linde completed a tender offer on August 8, 2012, during which
it bought roughly 88.85% of Lincare's common stocks for $41.50 per
share in cash. Linde subsequently purchased the rest of the issued
and outstanding shares through a short-form merger. Linde utilized
its "top-up" option to acquire the additional shares directly from
the company at the same rate of $41.50, as offered in the
Acquisition will Significantly Boost Linde's U.S.
The merger should be accretive for Linde as it will be able to
expand its market base significantly, especially in the U.S. Some
of the other players in the U.S. home health care market are
Gentiva Health Services Inc.
Rotech Healthcare Inc.
). With this acquisition, Linde will be able to double its sales in
the North American Gases business and target the €4 billion U.S.
health care market, which is the largest in the world.
Florida-based Lincare is a leading provider of oxygen and other
respiratory therapy services to patients at home. The company
offers services and equipment to more than 800,000 clients across
the U.S. and Canada through 1,091 local outlets. Two-thirds of the
€12 billion global health care industry is dedicated to homecare
products with an annual growth rate of roughly 6%. The merger will
enable Linde to become the global leader in health care offerings
within the gases industry.
Prior to the Lincare acquisition, Linde's connection with the
U.S. was through its Homecare business, which supplied products to
other home health care companies in the U.S. Also, Linde's
subsidiary LifeGas has been doing business with Lincare for several
Linde's health care division provides medical gas and
pharmaceutical offerings for the treatment of a variety of clinical
conditions such as aerosol therapy, oxygen therapy, asthma,
anesthesia, chronic obstructive pulmonary disease, sleep apnea and
pain. In 2011, Linde's health care division generated revenues of
However, Lincare derives a major portion of its revenue from
government sources and is therefore vulnerable to reimbursement
rate cuts and uncertainties surrounding the competitive bidding
program. Medicare reimbursement pressure will continue to be an
overhang on the industry and Linde will have to deal with the
problem as reimbursement pressure is not expected to stabilize
GENTIVA HEALTH (GTIV): Free Stock Analysis
ROTECH HEALTHCR (ROHI): Free Stock Analysis
To read this article on Zacks.com click here.