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German conglomerate to buy Clearwater's Lincare for $4.6 billion

Clearwater home oxygen services giant Lincare Holdings is being acquired by a German conglomerate in a $4.6 billion deal.

Linde AG, which specializes in industrial and medical gases, including oxygen, is making a tender offer of $41.50 per share in cash for all outstanding stock of Lincare.

The deal was foreshadowed last week in a blog by the Financial Times that several news organizations, including the Tampa Bay Times, picked up on. The news drove shares up nearly 25 percent. On Monday, Lincare's stock soared 22 percent more, or $7.32, to close at $41.34. It was among the biggest gainers on the Nasdaq market.

Linde chief executive officer Wolfgang Reitzle said the deal would double sales for the company's North American gases division.

"Health care is one of our three growth pillars," he told journalists in a conference call Monday. He called the health business "a global megatrend," due to aging populations and new treatments.

Linde acquired European home care business America's Air Products and Chemicals for about $600 million earlier this year, boosting its presence in Belgium, Germany, France, Portugal and Spain. The purchase of Lincare would expand the company's reach across the United States.

Lincare chief executive officer John P. Byrnes said his board thinks the planned merger "will afford the company benefits it would not be able to realize on its own."

Lincare, the eighth-largest public company based in the bay area, reported net revenues of $1.85 billion last year, a 10.7 percent increase over the year before.

The company provides in-home respiratory therapy to patients in 48 states and in Canada through 1,091 local centers, and has 11,000 employees. Its services include oxygen therapy, chemotherapy, pain management, treatment of sleep apnea and home ventilators.

Lincare executives have told investors they see revenues being driven by an aging population, advances in lung medicine, along with new drugs, and cost pressures that reward more efficient service providers. Just less than half of the company's revenues come from Medicare, the U.S. government insurance program for people age 65 and older, and about a third from private insurance.

Times staff writer Jeff Harrington contributed to this report.

German conglomerate to buy Clearwater's Lincare for $4.6 billion 07/02/12 [Last modified: Monday, July 2, 2012 9:22pm]
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