Air Products Refutes Yingde’s Cooperation Claims

Following its $1.4 billion offer last month to buy Yingde Gases Group, Air Products has taken the unusual step of publicizing a letter it has written disputing several public statements made by the Chinese company.

In the Feb. 14 letter, which was sent to Yingde’s board of directors and filed with the US Securities and Exchange Commission (SEC), the US industrial gases group disputes Yingde’s claims that the two companies “are working actively and closely on diligence” and that Air Products has “acknowledged the support from current management in respect of the potential offer.”

The move was in response to Yingde’s press release discussing its cooperation with Air Products and showing a photograph of the US group’s CEO Seifi Ghasemi shaking hands with Yingde chairman Zhao Xiangti.

Air Products stated that not only has it not received any due diligence materials to date but Yingde has been obstructive, including delaying the establishment of an Independent Board Committee to evaluate the proposal and also in retaining an independent financial advisor for the committee.

The Pennsylvania-headquartered group expressed its concern that Yingde’s delayed response to the bid is related to a tussle between the Chinese firm’s executive management and two former directors, who together control about 29% of the stock and who are attempting to regain their seats on the board.

Yingde’s “slow pace of engagement” and the hurdles imposed may reflect the fact that the majority directors “have no genuine desire to engage in a constructive process but are simply trying to use inaccurate statements to gain a favorable position with shareholders in the proxy contest at the upcoming extraordinary general meeting,” Air Products stated. The meeting is currently scheduled for Mar. 8.

Air Products said it does not intend to comment further at this time.