Lincoln Electric steps to the plate with $125M to purchase the France based Air Liquide Welding. Growth by acquisition – it seems the tool industry as a whole sees this happen on a weekly basis. It’s almost as though the news of acquisitions is the norm and no longer news. Lincoln Electric may be seeing the welding industry growth ahead and pouncing while they can.
“We are excited at the prospect of joining two leading welding and cutting organizations together who are dedicated to delivering best-in-class engineered solutions,” said Christopher L. Mapes, Lincoln Electric’s chairman, president and CEO, in the release.
According to Persistence Market Research, welding equipment sales in the US eclipsed $10.5 Billion in 2016. In their report “Welding Equipment Market: Global Industry Analysis and Forecast, 2016 -2024”, this segment is expected have an annual growth rate of 7.9% through 2024. This nearly doubles revenue over the eight years, topping $19.1 Billion by the end of 2024.
Keep in mind, this is only the “Welding Equipment” market. The Welding Consumables market is even bigger, and neither of these include the Service side of the industry. Bottom line – welding is HOT! (Punn intended). The automobile and construction (infrastructure) industries are driving the demand for welding.
While the welding industry is heating up in the Americas, the greatest growth is expected to be seen the most in Asia. Europe follows a close second, with the US trailing in third. Perhaps, Lincoln is setting up to capture more of the international growth market. Not a bad idea.
Make Work Cool Again
No better time than this to push for a comeback of the blue-collar American worker. Kudos to Mike Rowe (“Dirty Jobs” host) for proclaiming “If you wanna make America great again, you gotta make work cool again.” Welders have the potential to earn a very nice living, and rightly so. The future holds even more promise, especially for the trained and experienced welder.
Let’s kill the stigma in schools across America that college is for winners, and the trades is for…the “others”. How about – jobs are for winners! Shouldn’t we be training our young people for the jobs that are actually available. More importantly, Educate (imagine this in schools) these kids on the trades that are growing, as well as show them what they can be worth in 20 years.
Technology and online training is making it easier than ever to learn new skills. The Miller Multimatic 215 review shows just how easy it is, with today’s machines, to start welding. Pex for plumbing and new power tools associated with plumbing is transforming that indutry also. In addition, the likes of products like the SnapOn MODIS Edge Scan Tool leap auto technicians for above the typical mechanic status.
Lincoln Electric Holdings Acquires Air Liquide Welding
Lincoln Electric, located in Euclid, OH, announced in March they were purchasing Air Liquide Welding for €115 million (~$125 US million). Air Liquide Welding is a subsidiary of Air Liquide, a world leader in gases, technologies and services for Industry and Health. The France based company is present in more than 80 countries, employing more than 67,000, and serving over 3 million customers and patients.
If the Air Liquide name rings a bell, they purchased AirGas last year for over $13B US.
Growth in industry is great to see, in just about any capacity. Welding industry growth adds a bit of flare and excitement because it tends be the beginning stages of infrastructure growth. This up-tick in the welding industry should lead to an increase in road-paving, bridge-building, building construction, and eventually plumbers and A/C technicians.
Lincoln Electric stands as a major player in the US welding equipment market, and we can’t blame them for flexing their muscle to purchase market share. In addition, this acquisition of Air Liquide Welding is for an existing, successful organization. There is no need to pull this one out of the ditches, hence it’s proven and profitable.
Will the Lincoln – Air Liquide acquisition spur others? We can’t help but ponder, acquisitions such as this must tempt the other major players in the US to go on the hunt. Is it Miller that strikes with the acquisition news, or do we see ESAB expand its roots? Regardless, these are exciting times and we look forward to covering all the great news.
The proposed acquisition is expected to close in the second half of 2017.