Macquarie's $3.6 billion S. Korean gas firm draws interest from KKR, Brookfield and industry peers, sources say

Macquarie Asset Management is seeking to sell its South Korean industrial gas firm, DIG Airgas, for a potential $3.6 billion, attracting interest from KKR, Brookfield Asset Management, and Air Liquide. Goldman Sachs and JPMorgan are managing the sale, with non-binding bids expected this month; Macquarie anticipates a valuation of 18-20 times DIG Airgas' core earnings, which are approximately $170 million to $180 million in EBITDA.

Analysis

Macquarie Asset Management (MQG.AX) is actively pursuing the sale of its South Korean industrial gas firm, DIG Airgas, with expectations that the deal could reach a valuation of up to $3.6 billion. The sale process, managed by Goldman Sachs (GS.N) and JPMorgan (JPM.N), has garnered significant interest from a diverse pool of potential bidders, including investment firms KKR & Co (KKR.N) and Brookfield Asset Management (BAM.TO), French gas supplier Air Liquide (AIRP.PA), infrastructure funds I Squared Capital and Stonepeak, and U.S.-based Air Products (APD.N). DIG Airgas, South Korea's third-largest industrial gas producer, generates approximately $170 million to $180 million in annual EBITDA. Macquarie anticipates a sale valuation at a multiple of 18-20 times these core earnings. This represents a substantial potential return, considering Macquarie acquired the company, formerly Dausung Industrial Gases, from MBK Partners in 2019 for about $1.85 billion (2.5 trillion won). The strong interest from both financial sponsors and strategic industry players highlights the attractiveness of assets in South Korea's industrial gas sector, described by Air Products as a "vital and growing market."

Key Decisions for Investors

• Investors in Macquarie (MQG.AX) should monitor the progress of the DIG Airgas sale, as a transaction near the $3.6 billion target would represent a significant gain on its 2019 investment and could positively influence Macquarie's financial results and valuation.
• For investors tracking potential acquirers such as KKR (KKR.N), Brookfield Asset Management (BAM.TO), Air Liquide (AIRP.PA), and Air Products (APD.N), the key consideration will be the strategic fit and financial discipline exercised if pursuing DIG Airgas at the anticipated 18-20 times EBITDA multiple, particularly in relation to growth prospects in the South Korean market.
• The robust bidding interest and high valuation multiple signal strong institutional demand for specialized industrial assets in developed Asian markets; this trend may present further M&A opportunities or support valuations for comparable companies operating in the industrial gas and infrastructure sectors.