Air Products (APD) said Thursday it will present its $5.1 billion takeover offer for Airgas Inc. (ARG) directly to shareholders, seeking to overcome resistance to the deal from the Airgas board of directors.

Airgas board's refusal to discuss the bid "has left us with no alternative," Air Products said. The Lehigh Valley, Pa. industrial gas maker said it would take "all necessary steps" to acquire its smaller rival, and urged Airgas shareholders to "send a clear message to their board" that they want a deal.

"We respect [Airgas Chief Executive] Peter McCausland and greatly admire the company he founded and matured, but we fundamentally disagree with him on achievable standalone value and do not believe his approach is in the best interests of the owners of the other approximately 90% of Airgas shares," Air Products said in a statement.

If Air Products wins the hearts of Airgas' shareholders--or manages to sway its reluctant board--it would become the largest industrial-gas maker in North America by revenue. Airgas would bring a profitable business of selling gases to science labs and hi-technology firms, as well as other small to mid-sized companies in North America. It's an area where growth is expected during the economic recovery.

Radnor, Pa.-based Airgas said Thursday that its board of directors would review the unsolicited tender offer as it is required by law, but noted that the proposal was similar to one already rejected.

Airgas stockholders were advised to take no action pending the review.

On Tuesday, Airgas declined the $60 per share public bid Air Products made last week, saying it significantly undervalues the company and isn't in the best interest of shareholders. The company also declined a private cash and stock offer of $62 a share in December.

Air Products is clearly willing to endure a proxy contest, but analysts believe Airgas has significant defenses to a ward off a hostile takeover. "Right now, we believe the likelihood of a deal being completed is less than certain, and becomes even less likely as time drags," Thomas Hayes, an analyst with PiperJaffray wrote in a note to clients this week.

Air Products has annual sales of $8.3 billion and sells gases such as argon, hydrogen and oxygen to industrial plants.

Shares of Air Products traded down 31 cents to $67.92 Thursday morning. Airgas shares traded up 1 cent at $61.32.

-By Susan Daker, Dow Jones Newswires; 713-547-9208; susan.daker@dowjones.com

   (Nathan Becker contributed to this article)
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