RADNOR, Pa., Sept. 8 /PRNewswire-FirstCall/ -- Airgas, Inc.
(NYSE: ARG) today announced that its Board of Directors, after
careful consideration with its independent financial and legal
advisors, unanimously rejected the revised unsolicited tender offer
from Air Products & Chemicals, Inc. (NYSE: APD) to acquire all
outstanding common shares of Airgas at a price of $65.50 per share in cash. The Board
unanimously recommends that Airgas stockholders not tender their
shares into Air Products' revised offer. The Board also urges
stockholders to vote FOR Airgas' three experienced and
highly qualified directors and AGAINST Air Products' By-Law
amendment proposals at Airgas' Annual Meeting of Stockholders on
September 15, 2010.
Airgas Chairman and Chief Executive Officer Peter McCausland said, "The Airgas Board of
Directors is unanimous in its belief that Air Products' revised
offer, which represents only a $2.00
per share increase over its previous offer, continues to grossly
undervalue Airgas. We believe that this slight increase in
Air Products' offer price does not adequately compensate Airgas
stockholders for the Company's inherent value, excellent prospects
and impressive economic performance since Air Products first
announced its offer. The Board is unanimous in its belief
that $65.50 per share is not an
appropriate value or a sensible starting point for negotiations to
achieve such a value."
Mr. McCausland concluded, "We believe that Air Products' threat
to withdraw its offer if Airgas stockholders do not elect its
nominees and approve its By-Law proposals is just another coercive
tactic designed to facilitate the acquisition of Airgas at the
lowest possible price. If Air Products follows through on its
threat, Airgas intends, through repurchases or other transactions,
to assist its stockholders who desire to sell their shares in the
near term."
The basis for the Board's recommendation with respect to the Air
Products tender offer is set forth in more detail in Airgas'
Schedule 14D-9 amendment, which will be filed today with the
Securities and Exchange Commission ("SEC").
In connection with the filing of its Schedule 14D-9 amendment,
Airgas today sent the following letter to all Airgas
stockholders:
Dear Airgas Stockholder:
The Airgas Board of Directors has unanimously rejected the
revised Air Products offer to purchase Airgas common stock at
$65.50 per share in cash. In
our Board's judgment, the new Air Products offer - which
represented only a $2.00 per share
price increase and was below the Airgas closing stock price on the
last trading day before the announcement of the revised offer - is
grossly inadequate and does not represent an appropriate value for
your Airgas shares. We believe this offer is yet another
opportunistic attempt to cut off the Airgas stockholders' ability
to benefit as the domestic economy continues its recovery. We
urge you NOT to tender your shares into the revised Air Products
tender offer.
$65.50 per share - a mere 3%
increase - is not an appropriate price. We believe
that this slight increase in Air Products' offer price does not
compensate Airgas stockholders for the Company's scarcity and
synergy value, our extraordinary history of providing superior
returns for our stockholders, our impressive economic performance
since the first Air Products offer and our excellent prospects.
Our record of past and current accomplishments, and our
record of emerging strongly from prior recessions, support our
belief in the achievability of our growth prospects. Our SAP
implementation, the costs of which were effectively paid for by
Airgas stockholders and which have been included in our earnings
per share estimate of $4.20+ for calendar 2012, also creates
significant stockholder value.
Further, acquiring Airgas would create enormous financial
benefits for Air Products. Based on Air Products' own
statement, at $65.50 per share, the
acquisition is expected to be immediately accretive to Air
Products' earnings per share on both a GAAP and cash basis,
excluding one-time costs. As described in the attached
Schedule 14D-9, we believe the synergy benefits of $250 million that Air Products has announced
would be worth over $20 per Airgas
share.
In addition, we believe that the $5.50 per share increase of the latest Air
Products offer as compared to its February offer - a 9.2% increase
over the initial $60 per share price
- should be viewed in the context of developments in the industrial
gas industry in the seven months since Air Products announced the
initial offer. Since that time, the average percentage share
price appreciation of the three major industrial gas companies,
excluding Air Products and Airgas, was approximately 18.3%.
Similarly, since the date of the initial offer, the relevant
sector trading multiples have substantially expanded. Indeed,
as shown in the attached Schedule 14D-9, the latest interim results
of industrial gas companies all demonstrate strong performance.
We believe this reflects an industry-wide trend and
underscores the inadequacy of the Air Products offer.
For these reasons, as well as the others described in the
attached Schedule 14D-9, our Board believes strongly that the Air
Products offer should be rejected.
Share repurchases and other transactions.
Air Products' most recent tactic to deprive our stockholders of
value - its threat to terminate its efforts to buy Airgas if Airgas
stockholders do not elect all of its nominees and approve all of
its By-Law proposals at our upcoming Annual Meeting - is consistent
with Air Products' approach throughout the past 10 months.
These tactics have included the low-ball pricing of its
offers for Airgas; the public relations effort to justify that
pricing and to "talk down" Airgas' performance and its prospects;
the constant attacks impugning the Airgas Board and its response to
the inadequate offers from Air Products; and the effort, through
its proxy solicitation, to cut off Airgas stockholders' ability to
benefit from Airgas' very strong performance. Instead of
offering an appropriate value, Air Products has offered a small
price increase, coupled with what it hopes will be regarded as a
large threat.
We believe that the strategic importance of Airgas to Air
Products and the financial attractiveness of the transaction to Air
Products make it unlikely that Air Products will terminate its
offer if each of its conditions is not met. Accordingly, we
urge Airgas stockholders not to be swayed by Air Product's cynical
and coercive tactics. However, as we describe in the attached
Schedule 14D-9, if Air Products does carry out its threat to
terminate its efforts to acquire Airgas, Airgas intends, through
repurchases or other transactions, to assist its stockholders who
desire to sell their shares in the near term.
Our Board has committed to call a June 2011 Special Meeting. Our
Board believes that Air Products is seeking, through its three
nominees to the Airgas Board of Directors and its By-Law proposals
- in particular its January Meeting Proposal - to divert from our
stockholders to Air Products the value Airgas stockholders would
realize if Airgas continues on its current course. Airgas and
its directors have already made a binding commitment to call a
Special Meeting of Stockholders on June 21, 2011, if Air
Products' January Meeting Proposal does not receive support from a
majority of the votes represented and entitled to vote at the
September 2010 Annual Meeting.
This Special Meeting would give stockholders the ability to
vote for a number of individuals so that, if a plurality of Airgas
stockholders vote for these nominees, these nominees, together with
any Air Products nominees elected at the September 2010 Annual Meeting, would constitute a
majority of the Airgas Board. In short, by means of the June
Special Meeting, we are seeking to satisfy our stockholders' and
our Board's desire that the Board be held accountable for the
Company's performance and its response to the Air Products offers.
Our additional commitment to explore alternatives to
enhance stockholder value. We believe that the
ability to add two additional quarters of performance to the
Company's record will significantly enhance our value as the Board
responds to Air Products and proactively explores ways to enhance
stockholder value. As a result, Airgas and its directors now
make an additional commitment to our stockholders: if the
January Meeting Proposal does not receive support from a majority
of the votes represented and entitled to vote at the September 2010 Annual Meeting, prior to the
June 2011 Special Meeting, our Board
will explore all available alternatives to the grossly inadequate
Air Products offer in order to enhance stockholder value.
In this regard, the Airgas Board has made clear on numerous
occasions its willingness to engage in negotiations that it
believed would result in an appropriate value for Airgas
stockholders. We would be willing to commence negotiations
with Air Products or any other party if we believed an appropriate
value would result. However, the latest Air Products offer of
$65.50 per share is not an
appropriate value or a sensible starting point for negotiations to
achieve such a value.
Consider who is best aligned with your
interests. As you evaluate Air Products' actions and
its tender offer, we ask you to remember that it is in Air
Products' economic interest to acquire your company at the cheapest
possible price. In contrast, the members of the Airgas Board
of Directors are fellow Airgas stockholders who, in addition to
having fiduciary duties to you as directors, have substantial
investments in Airgas. The current Airgas directors,
including our Chairman and Chief Executive Officer, Peter McCausland, own a total of approximately
11% of the Airgas shares (including options). We believe this
stake firmly links the Board's economic interests with those of our
stockholders.
We appreciate your continued support.
On behalf of the Board of Directors,
Peter McCausland
Chairman and Chief Executive Officer
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The Important Annual Meeting is
Just One Week Away—
We Encourage You to Vote
Promptly--by Telephone or by Internet.
If you have questions about how
to vote your shares on the WHITE
proxy card,
or need additional assistance,
please contact the firm
assisting us in the solicitation
of proxies:
INNISFREE M&A
INCORPORATED
Stockholders Call Toll-Free:
(877) 687-1875
Banks and Brokers Call Collect:
(212) 750-5833
IMPORTANT
We urge you NOT to sign any Gold
proxy card sent to you by Air Products.
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The Company's amended 14D-9 filing is available on the SEC's
website, www.sec.gov. In addition, the amended 14D-9 filing,
this press release and other materials related to Air Products'
Unsolicited Proposals are available in the "Investor Information"
section of the Company's website at www.airgas.com, or through the
following web address:
http://investor.shareholder.com/arg/airgascontent.cfm.
BofA Merrill Lynch and Goldman, Sachs & Co. are serving as
financial advisors, and Wachtell, Lipton, Rosen & Katz is
serving as legal counsel to Airgas and its Board of Directors.
About Airgas, Inc.
Airgas, Inc. (NYSE: ARG), through its subsidiaries, is the
largest U.S. distributor of industrial, medical, and specialty
gases, and hardgoods, such as welding equipment and supplies.
Airgas is also one of the largest U.S. distributors of safety
products, the largest U.S. producer of nitrous oxide and dry ice,
the largest liquid carbon dioxide producer in the Southeast, and a
leading distributor of process chemicals, refrigerants, and ammonia
products. More than 14,000 employees work in approximately
1,100 locations, including branches, retail stores, gas fill
plants, specialty gas labs, production facilities and distribution
centers. Airgas also distributes its products and services
through eBusiness, catalog and telesales channels. Its
national scale and strong local presence offer a competitive edge
to its diversified customer base. For more information,
please visit www.airgas.com .
IMPORTANT INFORMATION
In connection with its 2010 Annual Meeting of Stockholders,
Airgas, Inc. has filed a definitive proxy statement on Schedule 14A
with the Securities and Exchange Commission (the "SEC"). INVESTORS
AND STOCKHOLDERS OF AIRGAS ARE URGED TO READ THE PROXY STATEMENT
FOR THE 2010 ANNUAL MEETING IN ITS ENTIRETY BECAUSE IT CONTAINS
IMPORTANT INFORMATION. In response to the tender offer proposed by
Air Products and Chemicals, Inc. referred to in this communication,
Airgas has filed with the SEC a Solicitation/Recommendation
Statement on Schedule 14D-9, as amended. STOCKHOLDERS OF AIRGAS ARE
ADVISED TO READ AIRGAS' SOLICITATION/ RECOMMENDATION STATEMENT ON
SCHEDULE 14D-9, AS AMENDED, IN ITS ENTIRETY BECAUSE IT CONTAINS
IMPORTANT INFORMATION. This communication does not constitute an
offer to sell or the solicitation of an offer to buy any securities
of Air Products. Investors and stockholders will be able to
obtain free copies of Airgas' definitive proxy statement, the
Solicitation/Recommendation Statement on Schedule 14D-9, any
amendments or supplements to the proxy statement and/or the
Schedule 14D-9, any other documents filed by Airgas in connection
with the 2010 Annual Meeting and/or the tender offer by Air
Products, and other documents filed with the SEC by Airgas at the
SEC's website at www.sec.gov . Free copies of the definitive
proxy statement, the Solicitation/ Recommendation Statement on
Schedule 14D-9, and any amendments and supplements to these
documents are also available in the "Investor Information" section
of the Company's website at www.airgas.com , or through the
following web address:
http://investor.shareholder.com/arg/airgascontent.cfm. Airgas
and its directors and certain of its executive officers may be
deemed to be participants in the solicitation of proxies in
connection with its 2010 Annual Meeting. Detailed information
regarding the names, affiliations and interests of Airgas'
directors and executive officers is available in the definitive
proxy statement for the 2010 Annual Meeting, which was filed with
the SEC on July 23, 2010. To
the extent holdings of Airgas securities have changed, such changes
have been or will be reflected on Statements of Change in Ownership
on Form 4 filed with the SEC.
FORWARD-LOOKING STATEMENTS
This presentation contains statements that are forward looking.
Forward-looking statements include the statements identified as
forward-looking in the Company's press release announcing its
quarterly earnings, as well as any statement that is not based on
historical fact, including statements containing the words
"believes," "may," "plans," "will," "could," "should," "estimates,"
"continues," "anticipates," "intends," "expects" and similar
expressions. All forward-looking statements are based on current
expectations regarding important risk factors and should not be
regarded as a representation by us or any other person that the
results expressed therein will be achieved. Airgas assumes no
obligation to revise or update any forward-looking statements for
any reason, except as required by law. Important factors that could
cause actual results to differ materially from those contained in
any forward-looking statement include the factors identified in the
Company's press release announcing its quarterly earnings, as well
as other factors described in the Company's reports, including its
March 31, 2010 Form 10-K, subsequent
Forms 10-Q, and other forms filed by the Company with the
Securities and Exchange Commission. The Company notes that
forward-looking statements made in connection with a tender offer
are not subject to the safe harbors created by the Private
Securities Litigation Reform Act of 1995. The Company is not
waiving any other defenses that may be available under applicable
law.
Media Contact:
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Jay Worley
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jay.worley@airgas.com
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(610) 902-6206
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Investor Contact:
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Barry Strzelec
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barry.strzelec@airgas.com
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(610) 902-6256
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Joele Frank / Dan Katcher /
James Golden
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Joele Frank, Wilkinson Brimmer
Katcher
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(212) 355-4449
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SOURCE Airgas, Inc.
Copyright t. 8 PR Newswire