Business model of The Linde Group

The Linde Group

The Linde Group is a gases and engineering company with global operations. Its Corporate Centre is based in Munich, Germany. Linde has around 65,500 employees and is represented in more than 100 countries worldwide. It generated revenue in the 2014 financial year of EUR 17.047 bn. The Group comprises three divisions:

  • Gases Division
  • Engineering Division
  • Other Activities

Gases Division

The Group offers a wide range of compressed and liquefied gases as well as chemicals, and is the partner of choice across a huge variety of industries. Linde gases are used, for example, in the energy sector and in steel production, chemical processing, environmental protection and welding, as well as in food processing, glass production and electronics. The Group is also investing in the expansion of its Healthcare business (medical gases, medical devices, clinical care and related services) and is a leading global player in the development of environmentally friendly hydrogen technology.

Industrial gases

Linde produces and markets the air gases oxygen, nitrogen and argon which it makes in its own air separation plants as well as hydrogen, acetylene, carbon monoxide, carbon dioxide, shielding gases for welding applications, noble gases and high-purity specialty gases. Linde gases are used across all the continents of the world in almost all industry sectors, in trade, and in science and research. Linde also develops and markets systems and plants for gases applications all over the world in several technological application centres. In addition, the Group provides its customers with comprehensive support services and technical equipment. The Linde Industrial Gases business unit is the world’s largest supplier of welding and safety products.

Medical gases

The Healthcare business unit is a globally leading healthcare provider specialising along an integrated respiratory care path. Linde Healthcare combines pharmaceutical gases, medical devices, services and clinical care into solutions with the patient in mind for conditions and applications such as chronic obstructive pulmonary disease (COPD), sleep apnoea, pulmonary hypertension, anaesthesia and pain relief. Its products and services make a difference in the lives of patients and to healthcare professionals in the care continuum from hospital to home. Linde operates its healthcare business in more than 60 countries and all products and services meet high safety, quality and efficacy standards as stipulated by the authorities and official governmental bodies.

Product areas

Within the Gases Division, Linde allocates its activities to the following product areas:

  • On-site
  • Healthcare
  • Cylinder gases
  • Liquefied gases

In the case of the on-site business, customers are generally supplied via an on-site production plant, while in the other product areas gases are delivered to the customer in gas cylinders or tankers.

Operational management

On the organisational front, the Gases Division comprises three reportable segments: EMEA, Asia/Pacific and the Americas. Responsibilities are allocated on the basis of a regional structure. Within the three reportable segments, Regional Business Units (RBUs) are responsible for the operating business. This structure allows the Group to take account of the great importance of local and regional market conditions in the gases business.

In the course of developing its organisational model, Linde introduced a number of changes with effect from 15 January 2015:

The reportable segments are now the same as the operating segments. One member of the Executive Board is responsible for each of the operating segments.

In the EMEA segment, the RBU Continental & Northern Europe was divided into three new RBUs – RBU Central Europe, RBU Northern Europe and RBU Southern Europe. In the Asia/Pacific segment, the Group expanded RBU Greater China to include South Korea, an important market especially for the electronic gases business. The new RBU is called RBU East Asia. At the same time, RBU South & East Asia was renamed RBU South Asia & ASEAN. The three reportable segments in the Gases Division now comprise nine Regional Business Units.

Linde has also set up five Global Governance Centres (GGCs) which are managed centrally and act on a Group-wide basis: GGC Merchant & Packaged Gases (liquefied gases and cylinder gas), GGC Electronics (electronic gases), GGC Healthcare, GGC Operations and GGC Deliver. These units will, for example, establish best practice and ensure that the process standards which have been defined are implemented across the Group. The former Global Business Unit (GBU) Healthcare and the Business Area (BA) Electronics have merged into the newly created GGCs. The work of the former GBU Tonnage (on-site business) is being assumed by the RBUs and in particular by a Group-wide function entitled Opportunity & Project Development (OPD), which is designed to exploit investment-based business opportunities even more effectively than before. Moreover, Linde’s purchasing activities have been bundled together across the Group (Global Procurement).

The Corporate & Support Functions provide assistance to the business units of the Group. See Management organisation.

Engineering Division

Linde’s Engineering Division is successful throughout the world, with its focus on promising market segments such as olefin plants, natural gas plants, air separation plants, and hydrogen and synthesis gas plants. In contrast to virtually all its competitors, the company can rely on its own extensive process engineering know-how in the planning, project development and construction of turnkey industrial plants. Linde plants are used in a wide variety of fields: in the petrochemical and chemical industries, in refineries and fertiliser plants, to recover air gases, to produce hydrogen and synthesis gases, to treat natural gas and in the pharmaceutical industry. The Engineering Division either supplies plants directly to the customer or to the Gases Division, which operates the plants on behalf of the customer under a gases supply contract.

The Engineering Division is centrally managed and assisted by the Corporate & Support Functions. At Group level, one of the members of the Executive Board is responsible for the Engineering Division. See Management organisation.

Other Activities

Other Activities comprises the operations of logistics services company Gist. Gist specialises in the distribution of chilled food and beverages, and operates principally in the United Kingdom and in Ireland.

Organisation of the Linde Group

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Linde Group

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Engineering
Division

 

Other
Activities

 

 

 

Gases Division

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EMEA

 

Asia/Pacific

 

Americas

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The five Global Governance Centres (Merchant & Packaged Gases, Electronics, Healthcare, Operations and Deliver) are centrally managed and operate across the regions. One of the roles of the GGCs is to develop best practice and to ensure that the process standards which have been defined are implemented throughout the Group.

 

 

 

 

Merchant & Packaged Gases

 

 

 

 

 

 

 

 

 

 

 

Electronics

 

 

 

 

 

 

 

 

 

 

 

Healthcare

 

 

 

 

 

 

 

 

 

 

 

Operations

 

 

 

 

 

 

 

 

 

 

 

Deliver

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Opportunity & Project Development

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate & Support Functions

Corporate management

The Executive Board is international in composition and is responsible for the management of the company. Each operational member of the Executive Board is responsible for one reportable segment. See Management organisation. By reflecting the operating model in the allocation of responsibilities to individual members of the Executive Board, the Group ensures that the individual strengths and skills of the Executive Board members are used effectively at both regional and product level.