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Wednesday, 10 May, 2000, 15:42 GMT 16:42 UK
BOC merger collapses
BOC
BOC is the world's second largest industrial gases group
Shares of UK industrial gases company BOC Group fell sharply on the news that France's Air Liquide and US firm Air Products and Chemicals had abandoned their joint takeover bid for the group.

BOC's shares fell about 12% on the London stock exchange following the announcement, reversing early gains on hopes a deal would be struck.

They ended at 9.91, compared to the bid price of 14.20.

However, the two bidders have left the door open for a future bid under different terms.

The two said they would let their $11.2bn bid for the world's second largest industrial gases group lapse without US Federal Trade Commission approval. The offer expires on Friday.

"It has recently become clear that the FTC will not approve the offer by 12 May, the date on which the period for satisfying the pre-conditions to the offer will expire," the companies said in a joint statement.

"The offer will therefore not be made."

Regulatory problems

The deal hit regulatory problems shortly after its announcement last July, and the two bidders have been locked in talks with the FTC since that time.

Air Liquide and Air Products said they were looking into the possibility of divesting all of BOC's gas activities in the US to soothe FTC anti-trust concerns.

"Air Liquide and Air Products are prepared to continue exploring the terms of an agreement with the FTC and, possibly, to see if a new offer acceptable to BOC could be made," the companies said.

"Such a new offer would imply a different price and structure," they said.

But BOC said it wanted to remain independent, despite agreeing to the deal earlier.

"The board of BOC confirms its intention to pursue its strategy as an independent company," the company said.

Air Liquide and Air products are now liable to pay BOC a $100m breakup fee for failing to secure a deal.

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See also:

17 Sep 99 | The Company File
Euro probe into BOC takeover
31 Aug 99 | The Company File
BOC's Rosenkranz resigns
21 Jun 99 | The Company File
BOC rejects takeover bid
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