01—Abstract
Summary
Summary of the 10-K filed March 23, 2018. Cited figures are marked; the original filing is the authoritative source.
Linde plc's 2017 10-K filing primarily details its formation and the ongoing, significant business combination with Praxair, Inc. The company was incorporated in Ireland in April 2017 specifically to facilitate this all-stock transaction, which aims to combine the businesses of Linde AG and Praxair.
As of the filing date, Linde plc had not conducted any material business operations beyond those related to its formation and the business combination. The primary focus for investors in this filing is the status and risks associated with the pending business combination.
Key details include the expected completion in the second half of 2018, the regulatory approvals required from various international authorities, and the potential for delays or imposed conditions that could impact the combined entity. The filing highlights that the company is an "empty shell" at this stage, with all financial activity and risk revolving around the successful execution of the merger and exchange offer.
02—Key points
Key Highlights
- Linde plc was incorporated in Ireland in April 2017 as a vehicle for the business combination between Linde AG and Praxair, Inc.
- The business combination is structured as an all-stock transaction, expected to close in the second half of 2018.
- Significant regulatory approvals are required from multiple jurisdictions (e.g., US, EU, China, India), and delays or imposed conditions pose material risks.
- As of December 31, 2017, Linde plc had minimal financial activity, primarily consisting of formation and transaction-related costs.
- The company incurred a net loss of $1,882,646 for the period from its incorporation to year-end 2017, primarily due to formation and advisory expenses.
- Linde plc anticipates listing its shares on the New York Stock Exchange and Frankfurt Stock Exchange upon completion of the business combination.
- Key risks identified include regulatory hurdles, potential for negative impacts on operations due to the pendency of the transaction, and the successful integration of the two large companies.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2017filed March 23, 2018Financial Statements
FY2017 against FY2016
| Line item | FY2017FY2016 | Change |
|---|---|---|
| Revenue | $11.36B$10.53B | +7.8% |
| R&D Expenses | $93.00M$92.00M | +1.1% |
| SG&A Expenses | $1.21B$1.15B | +5.4% |
| Operating Income | $2.44B$2.25B | +8.8% |
| Interest Expense | $230.00M$208.00M | +10.6% |
| Net Income | $1.25B$1.50B | −16.9% |
| EPS (Basic) | $4.36$5.25 | −17.0% |
| EPS (Diluted) | $4.32$5.21 | −17.1% |
| Shares Outstanding (Basic) | 286.26M285.68M | +0.2% |
| Shares Outstanding (Diluted) | 289.11M287.76M | +0.5% |
05—Questions
Frequently Asked Questions
What is the current operational status of Linde plc as of the filing date?
As of December 31, 2017, Linde plc was in the formation stage and had not conducted any material business activities beyond those incidental to its creation and the ongoing business combination with Praxair, Inc. It essentially functioned as an 'empty shell' entity.
What is the main purpose of Linde plc's incorporation?
Linde plc was specifically incorporated in Ireland to serve as the parent company for the proposed all-stock business combination between Linde AG and Praxair, Inc. The goal is to merge these two industrial gas giants under Linde plc's ownership.
What are the major risks associated with the pending business combination?
The primary risks include obtaining necessary governmental and regulatory approvals, which could lead to delays or result in conditions (like divestitures) that reduce the anticipated benefits of the combination. Other risks involve the complexities of integrating two large companies, potential loss of customers or employees during the transition, and the risk that the fixed exchange ratios may result in shareholders receiving shares with a lower market value than their original holdings.
When is the business combination expected to be completed, and what are the implications for trading?
The business combination was expected to be completed in the second half of 2018. Upon completion, Linde plc planned to list its ordinary shares on the New York Stock Exchange and the Frankfurt Stock Exchange, and sought inclusion in the S&P 500 and DAX 30 indices. Until then, there was no public trading market for Linde plc shares.
06—Continue