The investment in the industrial gases group Messer was not just one of the most successful deals for the financial investor CVC. „The exact transaction structure was unclear for a very long time and changed several times,“ says Managing Partner Daniel Pindur.

In the end, the deal resulted in the creation of a global industrial gases group in family hands with a billion-euro valuation. CVC received the Corporate Finance Award from Börsen-Zeitung in the Private Equity category for this. The billion-dollar deal was triggered by the takeover of US industrial gases manufacturer Praxair by German industry giant Linde in 2016 – a 110 billion dollar deal. The merger of the two giants was so large that it inevitably led to conditions being imposed by the antitrust authorities – both the EU Commission and its US counterpart, the FTC.

„The two companies had to divest parts of their business in Europe and America. This created an opportunity for the Messer family to make acquisitions,“ reports Pindur on the constellation at the time. The antitrust authorities did not want a sole private equity buyer because they would probably have had to re-examine the situation after five years in the event of an exit.

This spoke in favour of a strategic buyer. „We approached the Messer family with the idea of joining forces and soon came to an agreement with the former CFO Hans-Gerd Wienands and Stefan Messer,“ recalls Pindur.

Wienands can be seen as the architect of the structure for the deal. The difficulty: the exact scope of the cartel conditions was completely unclear for a long time. At the beginning of Linde/Praxair's talks with the antitrust authorities, the valuation of the parts of the company to be divested was somewhere between 5 billion and 10 billion dollars. Only later did it become clear that it was the European and Americas business of Linde/Praxair, which was valued at around 9 billion dollars.

„Together with the Messer family, we decided to bid for all assets and were financed for the entire perimeter. So we initially established a shareholders' agreement for a joint venture without knowing the actual scope of the deal,“ says Pindur, describing the difficulties.

Surprisingly, Linde/Praxair then sold the European business to the Japanese Taiyon Nippo Sanso. „We then had to restructure the transaction within a very short period of time and ultimately only bought the „Americas“ perimeter. We founded a joint venture with the Messer family for this purpose. 42% of the shares went to us, 58% were held by the Messer family,“ explains Pindur.

CVC contributed around 500 million to 600 million euros in equity, while the Messer family contributed its Western European business, thus part of the business of the entire Messer Group. „As one of four exit options, the family agreed on a purchase right for our 42%“, Pindur explains the details. Other options were an IPO of the entire Messer Group or an IPO of the joint venture, or a sale of the joint venture to an external buyer. In order to take over the businesses of Linde and Praxair, the joint venture between Messer and CVC invested around 3.6 billion dollars (3.2 billion euros).

In the end, it was an extremely good transaction for both sides. „We are proud to have helped turn the family business Messer into a globally represented group,“ says Pindur, who is responsible for CVC's German business together with Alexander Dibelius. „In the four years up to 2023, we have almost doubled the company's operating profit (EBITDA) together.“

One of the reasons why the deal was so profitable for both sides was the good negotiating position vis-à-vis Linde/Praxair. „Messer and CVC were the only suitable buyers for the American business that Linde/Praxair had to give up in order for the merger to succeed,“ says Pindur, naming the key success factor for the lucrative deal.