Air Products Says FTC Signs Off On Airgas Bid
Industrial gas producer Air Products and Chemicals said on Monday it signed a consent degree with the U.S. Federal Trade Commission (FTC) that would let it acquire Airgas and the company also extended the tender offer for its rival.
Air Products had sought the approval for some time, and the extension was widely expected. Attention now turns to Airgas's annual meeting, which will be held next month.
The consent decree would let Allentown, Pa.-based Air Products complete the acquisition if and when it receives support from a majority of Airgas shareholders. Air Products would also need to divest some assets to satisfy the FTC's antitrust concerns.
"There remain no substantive impediments to closing immediately other than the intransigence of the Airgas board," Air Products Chief Executive John McGlade said.
Airgas said the tender extension and the FTC agreement "does nothing to change our conviction that the Air Products' offer grossly undervalues Airgas."
Air Products boosted its offer in early July to $63.50 per share cash, or $5.3 billion, from $60 per share.
When Air Products made its initial offer in February, Airgas shares had traded around $43, but they jumped after the offer and are now trading around $65.
Any shareholder wanting to gain a premium over the offer could simply sell in the open market today, though much of the company's stock is currently held by arbitrage investors betting on a higher bid.
As of Aug. 13, about 23% of outstanding Airgas shares have been tendered to support the offer, Air Products said, noting that the total includes shares of Airgas it already holds.
Air Products also pushed the deadline for Airgas shareholders to tender into its offer to Oct. 29. The previous deadline had been Aug. 13.
"We ... encourage all Airgas stockholders not to tender their shares into Air Products' grossly inadequate offer, and similarly encourage those who have tendered to withdraw their shares," Radnor, Pa.-based Airgas said in a statement.
Both companies posted better-than-expected quarterly profit last month.
Some Airgas shareholders, as well as Air Products itself, have sued Airgas, hoping to force it to agree to the deal. A Delaware judge declined to hold the trial quickly, instead opting for a fall trial after Airgas' shareholders meet.
