Air Products (NYSE: APD) today issued the following statement in response to the rejection by the Board of Directors of Airgas, Inc. (NYSE: ARG) of Air Products' fully financed tender offer for all the outstanding common shares of Airgas, Inc. for $60.00 per share all in cash:
"It is unfortunate that Airgas has yet again prevented its shareholders from receiving a 38% all-cash premium and immediate liquidity for their shares. Air Products' $60.00 per share all-cash offer not only removes any risk of future company performance or economic conditions, but would also create more value for Airgas shareholders than it can achieve on its own. Even assuming Airgas can deliver on its highly optimistic 2013/2014 financial projections, or its newly discovered 2012 projections, $60.00 per share in cash today far exceeds the present value of either of these projections. Now is the time for Airgas shareholders to be heard and demand the independent directors of Airgas form a Special Committee advised by independent advisors that will objectively evaluate our offer. Air Products remains committed to pursuing our $60.00 cash offer and will take all necessary steps to complete it."
Air Products believes the assertions Airgas made today in its press release and in the Schedule
14D-9 it filed with the SEC are misguided, reflect misinformation about Air Products' intentions and plans for Airgas, and are misleading to Airgas's stockholders. Among others:
• Airgas Claim: The offer grossly undervalues Airgas.
Airgas offers nothing new -- no new plan or strategy to enhance stockholder value beyond its existing outlook -- which has been lowered twice by Airgas over the past four months. Airgas consistently points the market backward, not forward, in its public statements. Air Products, on the other hand, offers immediate value and liquidity to Airgas stockholders.
• Airgas Claim: The offer and its timing are extremely opportunistic.
An 18% cash premium over the 52-week high in an uncertain market is hardly opportunistic. Airgas' attempts to lay its recent performance at Air Products' door should be rejected by its stockholders. The timing for Airgas stockholders to receive a substantial cash premium that may be redeployed as stockholders see fit is excellent. The deep recession Airgas points to is a reason to accept, rather than reject, certain value.
• Airgas Claim: The offer is highly uncertain and any payments made to Airgas stockholders would be considerably deferred… Air Products fails to commit to make the necessary divestitures…
Air Products does not have a North American packaged gas business. Air Products has repeatedly and consistently committed in writing to making the appropriate divestitures to achieve antitrust clearance -- Airgas' statement to the contrary is false. Airgas, not Air Products, offers uncertainty and deferred value to its stockholders based on promises of future performance.
• Airgas Claim: The offer's extraordinarily broad conditions render it illusory.
Air Products' conditions to its tender offer are customary and subject to negotiation with Airgas -- should Airgas ever choose to sit down in a constructive dialogue with Air Products. Air Products is committed to closing the tender offer.
• Airgas Claim: Air Products has employed highly aggressive tactics.
Airgas' rhetoric regarding tactics rings hollow after they (1) summarily rejected Air Products' repeated attempts for over five months to seek a friendly, constructive dialogue with Airgas, (2) commenced litigation against Air Products' counsel of over 40 years, and (3) charged Air Products' financial advisor with a conflict when Airgas retained and continues to employ Air Products' boardroom advisor of over a decade, Goldman Sachs. Airgas must offer its stockholders more than words and lawsuits to achieve greater value than that offered by Air Products' all-cash, premium offer.
• Airgas Claim: Air Products' acquisition of Airgas will likely reduce value… This is particularly concerning if Air Products again revises its offer to include stock.
Air Products is offering an all-cash premium to Airgas's stockholders, a fact which Airgas seeks to ignore and confuse. Airgas' repeated claim that its shares have outperformed Air Products' shares is neither accurate nor relevant to Airgas shareholders' consideration of a $60.00 per share all-cash offer. Airgas has refused to sit down and become informed regarding Air Products' plans for Airgas. Air Products urges Airgas to come to the table in a constructive dialogue that would clearly serve its stockholders better than continued delay.
At $60.00 per share in cash, the Air Products offer provides Airgas shareholders a 38% premium to Airgas' closing price of $43.53 on February 4, 2010, the last trading day prior to public disclosure of the Air Products offer, and is 18% above Airgas' previous 52-week high. Air Products has secured committed financing from J.P. Morgan, and the offer is not conditioned on financing. As previously stated in writing, Air Products is prepared to make appropriate divestitures to address regulatory issues in a timely manner.
The offer is conditioned on there being validly tendered and not withdrawn at least a majority of the total number of Airgas shares outstanding on a fully diluted basis, Airgas' Board of Directors redeeming or invalidating its "poison pill" shareholder rights plan, and receipt of regulatory approvals and customary closing conditions as described in the Offer to Purchase. Air Products' Offer to Purchase, Letter of Transmittal and other offering documents have been filed with the U.S. Securities and Exchange Commission. Airgas' stockholders may obtain copies of all of the offering documents free of charge at the SEC's website: www.sec.gov