Air Products launches $5.1 billion unsolicited bid for Airgas

Air Products and Chemicals, Inc, a global supplier of industrial gases and equipment yesterday made an unsolicited bid to acquire smaller rival Airgas Inc. for $5.1 billion in cash to create one of the world's leading integrated industrial gas companies.

Air Products had been engaged in a friendly takeover discussions with Airgas for the past four months, but the board of Airgas rejected two of its written offers and even refused to discuss its offer for a merger, said the Allentown, Pennsylvania-based Air Products chairman in a letter yesterday to his counterpart in Airgas.

Air Products is offering Radnor, Pennsylvania-based Air Products $60.00 per share to Airgas shareholders, a 38-per cent premium based on Thursday's closing price of $43.53 and 18 per cent above Airgas' 52-week high.

Air Products says it is willing to launch a hostile bid if this offer is once again rejected by the Airgas board, including staging a proxy fight for gaining control of the company.

Air Products, the world's largest hydrogen producer said that the total value of the transaction is approximately $7.0 billion, including $5.1 billion of equity and $1.9 billon of Airgas'assumed debt.

The merger of the two companies would bring substantial cost synergies of $250 million by 2012, and will be able to accelerate growth both in the domestic and international market by leveraging Airgas' extensive US sales force and packaged gases skills.