Air Water America Inc. (headquartered in New Jersey, USA,), which oversees our North American business, is pleased to announce the acquisition of American Gas Products LLC. (AGP), a prominent helium gas supplier throughout the United States. The acquisition was completed on September 28, 2023.
1. Overview
Air Water America is actively building its industrial gas supply business in North America through the acquisition of regional gas distributors and investments in air separation plants. In line with our future business expansion plans, we intend to diversify our gas offerings beyond atmospheric gases (oxygen, nitrogen, argon) to enhance our comprehensive capabilities as an industrial gas manufacturer and supplier.
As part of this business strategy, Air Water America acquired the business of AGP, which has a unique helium supply chain and an extensive customer base. Through established helium offtake agreements with multiple helium well sources in the U.S., AGP guarantees a reliable supply of helium even under tight supply-demand situations. Consequently, AGP holds a significant market share (approximately 22%) in the *1balloon helium gas market in the United States and continues to achieve consistent growth.
AGP will strengthen and expand its helium gas business by reinforcing its supply and sales footprint, including the construction of multiple fill plants. Additionally, AGP will develop a strategy to supply helium to industries with substantial market size, such as the *2healthcare market and the semiconductor industry, which is expected to experience high growth rates in the future. Furthermore, AGP will collaborate with our group company, Nippon Helium Inc., to increase our purchasing power of helium in the global market and build a stable supply system for high-value helium resources.
*1 Helium gas is used to inflate balloons for events and decorations, taking advantage of its property of being lighter than air.
*2 Helium is used in cooling superconducting coils of MRI devices, which produce cross-sectional images using strong magnets and radio waves, as well as for cooling and atmosphere-related applications in semiconductor manufacturing.
2. Helium market and the features of AGP
Helium is an industrial gas with unique characteristics such as inertness, lightness (the second lightest element after hydrogen), and an extremely low boiling point (minus 269°C). Helium, found in trace amounts in the atmosphere, is a rare natural resource extracted from natural gas fields in countries like the United States, Qatar, Algeria, and Russia. Helium is used in industry applications for electronics, healthcare, aerospace, and balloons. In Japan, the entire supply chain relies on imports based on long-term agreements. Liquid helium, at extremely low temperatures (-269 °C),is transported by sea in large bulk ISO containers and transfilled into liquid or high pressure cylinders and tube trailers at local fill plants and delivered to customers.
The helium market is currently facing supply shortages worldwide due to reduced operating rates of helium supplyplants and delays in launching new plants. Meanwhile, the helium market anticipates significant demand growth, primarily in the semiconductor and aerospace industries. with the end of global supply-demand tightness not in the foreseeable future. Despite tightness in supply, AGP has rapidly expanded its market share by not depending on helium procurement from oil and gas majors, but by entering helium procurement agreements with several small gas fields. This strength allows AGP to provide balloon grade helium at competitive prices.
3. American Gas Products, LLC Company Profile
(1) Company Name: American Gas Products, LLC
(2) Headquarters: Stoneham, Massachusetts, USA
(3) Representative: Matt D'Auria
(4) Established: 2002
(5) Sales: Approximately 10 billion yen (FY2022) *1 USD = 135 JPY
(6) Number of Employees: 108
(7) Business Activities: Wholesale and retail sale of helium gas and various industrial and specialty gases
* In this acquisition, Air Water America Inc. established a new subsidiary, American Gas Product Inc., which acquired all business operations of American Gas Products, LLC.
(Reference)
The Air Water Group is actively expanding its overseas industrial gas business in India and North America as part of its growth strategy for 2030. North America, in particular, is the world's largest industrial gas market, approximately five times the size of Japan, with a concentration of various manufacturing industries and cutting-edge technology sectors. It is also a market where new applications for industrial gases are being developed ahead of the rest of the world.
We started our operations in North America in 2018, focusing on distinctive gas-related equipment and engineering fields. In recent years, we have expanded our supply business through collaborations with local gas distributors and M&A. In addition to expanding our business development, we have established our own gas production plant and are working to build a comprehensive business infrastructure from production to sales of industrial gases.
Moreover, North America is a market where initiatives related to renewable energy and decarbonization are rapidly progressing in response to growing climate change measures. We are working to create demand in these new areas and are actively involved in building a green hydrogen supply chain, including investing in FirstElement Fuel, Inc., the largest developer and operator of hydrogen stations in California.
[Contact for inquiries]
Corporate Communications, Air Water Inc. E-mail：info-h@awi.co.jp
