(Adds Air Products response, updates share prices)
Airgas Inc.'s (ARG) board rejected the boosted $5.48 billion
takeover bid from Air Products & Chemicals Inc. (APD) and urged
shareholders to reject the $65.50-a-share offer as well as its
larger rival's slate of board nominees.
Airgas Chairman and Chief Executive Peter McCausland said the $2
a share, or 3%, increase over its prior offer "continues to grossly
undervalue Airgas" and "is not an appropriate value or a sensible
starting point for negotiations" considering the company's
performance and prospects.
Air Products on Wednesday criticized Airgas for "continuing
attempts to avoid" an Airgas shareholder vote on the offer and
reiterated its plans to walk away from the deal if holders don't
elect its nominees to the board and approve its proposals on Sept.
15.
The offer represents a 9.2% increase from the initial
$60-a-share offer in February. McCausland, in a letter to Airgas
holders, said that in the past seven months, shares of the three
major industrial gas companies, excluding itself and Air Products,
were up 18% in comparison.
McCausland said Air Products' threat to withdraw its offer if
holders don't elect its nominees at next week's annual meeting or
approve its bylaw proposal was "coercive," adding that for holders
who would like to sell their shares, Airgas is planning buybacks or
other transactions.
Airgas shares were down 1.3% at $64.88 in recent trading, while
Air Products was up 70 cents at $78.08.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481;
Tess.Stynes@dowjones.com