Wesfarmers (ASX:WES) to Divest Coregas to Nippon Sanso Holdings for $770 Million

December 20, 2024 01:44 PM AEDT | By Team Kalkine Media
 Wesfarmers (ASX:WES) to Divest Coregas to Nippon Sanso Holdings for $770 Million
Image source: shutterstock

Highlights 

  • Wesfarmers (WES) plans to divest Coregas to Nippon Sanso Holdings for $770m.  
  • The deal is subject to regulatory approvals and expected to conclude by mid-2025.  
  • Coregas is a key supplier of industrial, medical, and specialty gases in Australia.   

Wesfarmers (ASX:WES), a leading Australian conglomerate, has entered into an agreement to sell its Coregas business to Nippon Sanso Holdings Corporation (NSHD) for $770 million. The transaction aligns with Wesfarmers' strategic focus on portfolio management and optimizing shareholder returns.   

The sale remains subject to regulatory approvals from the Australian Competition and Consumer Commission and the Foreign Investment Review Board. If all conditions are met, the deal is anticipated to be finalized by mid-2025. Upon completion, Wesfarmers expects to record a pre-tax profit ranging between $230 million and $260 million, subject to adjustments.   

Coregas, part of Wesfarmers' Industrial and Safety division, is one of the largest suppliers of industrial, medical, and specialty gases in Australia. The company provides a wide range of gas solutions, including bulk gases for medium and large users, as well as cylinder gases distributed across Australia and New Zealand. Coregas has played a vital role in catering to industries requiring high-quality gases for medical, industrial, and specialty applications.   

Nippon Sanso Holdings (NSHD), listed on the Tokyo Stock Exchange, is a global leader in the gas supply industry. With a presence in over 30 countries, NSHD specializes in industrial, electronic, and medical gases. In Australia, its subsidiary Supagas Pty Ltd already holds a prominent position in the liquefied petroleum gas and gas distribution markets. The acquisition of Coregas will strengthen NSHD's footprint in the region and enhance its product offerings.   

Despite the sale of Coregas, Wesfarmers plans to maintain its Industrial and Safety division, which will continue to operate its Blackwoods and Workwear Group businesses. Excluding Coregas, this division reported earnings before tax of $72 million in the 2024 financial year.   

The transaction is considered a significant step in refining Wesfarmers' portfolio while enabling Coregas to expand its capabilities under the ownership of a global industry leader like NSHD. With the deal subject to approval, both companies aim to ensure a seamless transition to benefit their respective operations and stakeholders.   

This move highlights the evolving strategies of both companies to strengthen their respective market positions while leveraging growth opportunities within the industrial and medical gas sectors.   


Disclaimer

The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.


AU_advertise

Advertise your brand on Kalkine Media

Sponsored Articles


Investing Ideas

Previous Next
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.