Singapore sovereign wealth fund GIC Pte has emerged as the frontrunner to buy a stake in Messer SE, a deal that could value the German industrial gas maker at more than $10 billion, people familiar with the matter said.

The investment firm is in talks to inject about €2 billion ($2.2 billion) into Messer in return for a 20% stake, the people said, asking not to be identified because the information is private.

While GIC is currently seen as the most likely investor, EQT AB was also shortlisted and remains interested, they said.

Messer, which is based on the outskirts of Frankfurt, has been under family control for 125 years. The stake sale would give key shareholder representatives Stefan Messer and his son Marcel Messer ammunition to buy full control of a joint venture with CVC Capital Partners.

The German company has been in talks to buy out the private equity firm from the JV, known as Messer Industries GmbH, which owns former Linde assets in North and South America. Those negotiations are ongoing and haven’t led to an agreement on terms yet, the people said.

Any deal would mark the second marquee investment in a family-owned German industrial group in as many months. Closely-held manufacturing company Viessmann agreed last month to sell most of its business to US air conditioner maker Carrier Global Corp. for about €12 billion. The value of industrials deals globally stands at $140 billion this year, according to data compiled by Bloomberg, down 30% on the same point in 2022.

Representatives for EQT, CVC, Messer and GIC declined to comment.

Bloomberg News reported in January that Messer was in talks to raise funds from external investors and had sounded out sovereign wealth funds and buyout firms.

Messer’s operations have more than 11,000 employees globally and reported about €4.2 billion of sales in 2022, according to its website. The company, which focuses on industrial, medical and specialty gases, competes with companies such as Air Liquide SA and Air Products & Chemicals Inc. Beyond industrial gases, the company also builds cutting systems and gas control equipment.

GIC is estimated to manage about $690 billion of assets, according to research firm Global SWF.

--With assistance from Elffie Chew.

(Adds deal volumes in sixth paragraph.)