Outlook: BOC talks better be more than hot air

WHO SAID the world of industrial gases was terminally dull? For the first time since Dick Giordano took up the reins at BOC all those years ago with an American-style pay package, the industry has found itself a talking point.

The interest this time lies not in the size of the chief executive's remuneration (handsome though that remains) but the future ownership of BOC now that the company is caught in the middle of a three-way tug-of- war.

In an industry where just four players account for nearly half the world market, it was inevitable that the prospect of those four being condensed into three or even two would set the sparks flying.

So it has proved. No sooner had BOC's merger talks with Praxair of the US leaked out than Air Liquide of France and Air Products, also of the US, were on the blower to Danny Rosenkrantz. We could not have had a better drama on our hands if his opposite number in Paris or Philadelphia was called Guildenstern.

There is nothing that an investment bank likes more than to get an auction going on behalf of its client. However, JP Morgan seems to have been a little over-enthusiastic in the case of BOC, playing the rival bidders off against each other with such gusto, that two of them, Air Liquide and Air Products, decided to get together to spike its guns.

This was not quite in Mr Rosenkrantz's script. The idea of being bought for cash by Air Liquide, but with him remaining as chief executive of the enlarged group, had obvious appeal. The prospect of a break-up bid involving both the French and Americans in which BOC and its executive management would be torn to bits to appease the regulators, was much less appetising.

Having put BOC into play, the market is now waiting for the end-game. Mr Rosenkrantz must pray there is one that involves BOC, otherwise its share price will drop like a stone and his life expectancy along with it.

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