Airgas, Inc. Board of Directors Face Lawsuit by Air Products& Chemicals, Inc

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Company Name(s): 
Airgas
Case Name: 
Airgas v Air Products Shareholder Class Action 02/
Case Status: 
Lawsuit Filed
Affected Securities
NYSE: ARG
Lawsuit Overview
Type of Lawsuit: 
Mergers and Acquisition
Date Filed: 
02/05/2010
Class Period End: 
12/24/2009
Deadline To File for Lead: 
04/06/2010
Summary: 

Air Products & Chemicals filed a lawsuit against the board of directors of Airgas, Inc. (Public, NYSE:ARG alleging breach of fiduciary duty for not accepting Air Products & Chemicals previous offers to purchase Airgas.

Air Products & Chemicals, Inc filed a lawsuit against board of directors of Airgas, Inc alleging they breached their fiduciary duty owed to the shareholders of Airgas, Inc. (Public, NYSE:ARG) for not considering and accepting the offers made by Air Products & Chemicals.

In December 2009 Airgas received a cash and stock proposal from Air Products with an implied value of $62 per share, and in October 2009 Airgas received an all-stock proposal from Air Products with an implied value of $60 per share. The Airgas’ Board of Directors announced that it unanimously determined that Air Products’ proposals were not in the best interests of Airgas or its shareholders, as they grossly undervalued Airgas. Then on February 05, 2010 Air Products & Chemicals, Inc. (Public, NYSE:APD) made another attempt and announced that it has made another offer to acquire Airgas, Inc. (NYSE: ARG) for $60.00 per share in cash, or a total transaction value of approximately $7.0 billion, including $5.1 billion of equity and $1.9 billon of assumed debt. According to Air Products (NYSE: APD) the offer of $60.00 per share provides a 38% premium to Airgas shareholders based on yesterday’s closing price of $43.53 and is 18% above Airgas’ 52-week high. Airgas, Inc. reported in 2007 Total Revenue of $4.01702billion with a Net Income of $223.35million and in 2008 Total Revenue of $4.349.45billion with a Net Income of $261.09million. Shares of Airgas, Inc. (ARG) traded after the announcement at over $60.50 per share and almost $62 per share. ARG shares traded before the news at about $45 per share.

Air Products alleges in its complaint that it informally approached Airgas with an acquisition offer and was unreasonably rebuffed. Air Products accuses the board of Airgas dismissed its written offer without reasonable investigation and unreasonably rejected also its improved offer. Air Products believes that the board of directors disregarded the interest of the Airgas shareholders and will not take appropriate action to consider the Air Products offer or engage in in discussions. Air Products alleges irreparable harm to the Airgas’s shareholders caused by the actions of the Airgas board of directors and alleged breach of their fiduciary duty owed to its Airgas Shareholders (NYSE:ARG)