CORRECT (2/5): Airgas Considering Air Products' $5.1 Billion Takeover Offer
February 09 2010 - 4:44PM
Dow Jones News
Airgas Inc. (ARG) confirmed Friday that it is the object of a
hostile takeover bid and that its board of directors is reviewing
Air Products & Chemicals Inc.'s (APD) $5.1 billion cash
offer.
A merger would create the largest industrial-gas maker in North
America by revenue. Air Products, based in Allentown, Pa., has
annual sales of $8.3 billion and sells gases such as argon,
hydrogen and oxygen to industrial plants.
This is not Air Products' first attempt to buy its smaller
rival, which serves a different market segment and has retail
customer base.
In December, Airgas said it received a cash and stock proposal
from Air Products with an "implied," value of $62 a share. Airgas
said it turned down the offer because Air Products' stock has
historically underperformed its own.
In declining that offer, Peter McCausland, chairman and chief
executive of Airgas, said in a letter to Air Products that the
"unsolicited approach is simply an opportunistic attempt to buy
Airgas at a bargain price exploiting a brief anomaly in the
historic comparative equity market performance of our two
companies, just as the economy begins its recovery."
McCausland also said: "Airgas' associates, with the support of
our Board of Directors and shareholders, have built the most
valuable independent industrial gas company in the world. We have
an outstanding performance record, and strong prospects for organic
and acquisition growth in the coming years."
In October, Airgas received an all-stock proposal from Air
Products with an "implied," value of $60 a share.
Air Products' most recent offer of $60 a share in cash is nearly
a 38% premium to Airgas' closing price Thursday of $43.53.
Shares of Airgas recently traded up $17.32, or 39.8%, to
$60.85.
Shares of Air Products were trading down $5.09, or 6.9%, to
$68.60 Friday morning.
-By Susan Daker, Dow Jones Newswires; 713-547-9208;
susan.daker@dowjones.com
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