Taiyo Nippon Sanso acquired Renegade Gas, an LPG and industrial gas distributor in Australia, on July 31.

For Taiyo Nippon Sanso, it is first time to expand its business into Australia. In addition, this is M&A for overseas company following to the acquisition of Air Products Industry in Thailand in June, and expanding business into new overseas market for Taiyo Nippon Sanso as one of its strategy to increase overseas ratio in its total sales.

Taiyo Nippon Sanso and Renegade established their new holding company TNSC (Australia) with putting 85% and 15% capital respectively, and the acquisition was implemented through the new company.

Renegade has 17 locations in the East part of Australia including Sydney. Renegade is based in Inglenurn of NSW, which is suburb of Sydney. The number of employees is around 250. The net sales is expected to AUD82 million (or JPY8 billion) for FY2015 ended in June of this year. 96% of the sales is accounted by LPG and other industrial gases and 4% by sales and rental of gas related equipment. More than half of sales of gas business is accounted by LPG. Renegade does not own liquid gas plant therefore cylinder supply is the main business for the company. According to Taiyo Nippon Sanso, Renegade is holding 10% share of cylinder market in the Eastern Australia.

Australia’s GDP is the 12th largest in the world. Supported by relatively high growth rate of population (1-2%) among developed countries, steady economic growth is expected at around 3% a year for the time being with increase in personal spending and housing investment.

Taiyo Nippon Sanso is estimating the Australian industrial gas market to be approximately JPY120 billion, and expecting new demand in the housing/infrastructure related and resources/energy related industries in the country. The company expects that the acquisition of Renegade Gas would lead it to expand its business in the new market.

In terms of specific business of Renegade, it will expand marketing of medical gas and hard goods including welding related equipment which have been handled by Leeden (Singapore), an affiliate company of Taiyo Nippon Sanso. In the future, Renegade will have its own liquid gas plant.