Westfarmers (ASX:WES) agreed to sell its Coregas business to a subsidiary of Nippon Sanso Holdings Corporation (NSHD) for $770 million.
Once the sale is completed, Wesfarmers expects to record a pre-tax profit of between $230 million and $260 million, subject to closing adjustments. The sale remains subject to approvals from the Australian Competition and Consumer Commission and the Foreign Investment Review Board.
Subject to compliance with all conditions, the sale is expected to be completed by mid-2025.
Coregas is part of Wesfarmers’ Industrial and Safety division and is one of Australia’s largest manufacturers and suppliers of industrial, medical and specialty gases. The company distributes cylindered gases and supplies bulk gases to medium and large users in Australia and New Zealand.
Nippon Sanso Holdings (NSHD), listed on the Tokyo Stock Exchange, is the world’s fourth-largest supplier of industrial, electronic and medical gases, with operations in more than 30 countries. In Australia, its wholly owned subsidiary, Supagas Pty Ltd, is a leading supplier of liquefied petroleum gas as well as gas.
Wesfarmers chief executive Rob Scott commented: “We believe the divestment is in the best interests of Wesfarmers shareholders and is consistent with our disciplined focus on portfolio management. »
Wesfarmers’ Industrial and Security division will continue to operate its Blackwoods and Workwear Group businesses. Excluding Coregas, this division recorded $72 million in pretax profit in fiscal 2024.
Wesfarmers shares are trading down 2.25% at $71.57.
