Air Liquide has filed a lawsuit alleging that the Carlyle Group, a private equity firm, hired a senior Air Liquide executive as part of a scheme to get its hands on confidential business information. That information could give Carlyle the upper hand in acquiring Praxair and Linde industrial gas assets being auctioned as part of the $70 billion merger of the two gases giants, announced in December 2016.
Japanese industrial gas maker Taiyo Nippon Sanso agreed on July 5 to buy Praxair’s European gas business for nearly $6 billion. Taiyo, which is not now active in Europe, would get a business with annual sales of $1.5 billion, 2,500 employees, and operations in 12 countries. Carlyle and other suitors are still in the running for U.S. gas assets. Both sales are intended to quell antitrust concerns.
The deal with Taiyo brings Praxair and Linde a step closer to tying the knot and forming the world’s largest industrial gas maker, with over $30 billion in annual sales. Air Liquide, the current number one, has sales of about $23 billion.
Carlyle declined to comment on the Air Liquide suit. However, industry sources indicate that the private equity firm continues to pursue a deal for the remaining Praxair and Linde assets.
For its part, Air Liquide wants an injunction issued against Carlyle and the executive, Leslie Graff, formerly Air Liquide’s vice president for mergers and acquisitions in the Americas. The suit aims to prevent use of the allegedly stolen information and seeks the return of the stolen files and monetary damages against both Carlyle and Graff.
According to the suit, filed in a Pennsylvania federal court on June 12 but only recently publicized, Carlyle began talking with Graff in January about how he might help the private equity firm acquire Praxair and Linde assets. For three months prior to his resignation from Air Liquide at the end of April, the lawsuit charges, Graff absconded with a collection of documents that “would provide any company looking to compete in this market ... highly relevant and nearly invaluable information for guiding its investments and expenditures.”
Among the documents Graff allegedly downloaded to his personal email were financial valuation models and distributor prospect lists. Just before he tendered his resignation, the lawsuit charges, Graff viewed documents that detailed revenue and market share information for Air Liquide and its competitors.
Then on the way out the door, Graff allegedly printed “a trove of confidential documents.” And he purportedly took with him a number of unknown documents on two thumb drives.