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Air Products Bids Total $7.1B for Airgas

Air Products made an unsolicited $60 a share offer to buy rival Airgas after previous overtures were rejected. The total bid, including debt, is $7 billion.

Updated to include Airgas response to bid.



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Air Products

(APD) - Get Air Products and Chemicals, Inc. Report

made an unsolicited $60 offer to buy rival



after previous overtures were rejected.

Air Products said Friday the offer is a 38% to Airgas' closing stock price Thursday of $43.53.

Shares of Airgas were trading at $61.75 in premarket trading Friday.

Airgas said its board would review the proposal with itsfinancial and legal advisors and advised shareholders to "take no action at this time."

The total value of the offer is about $7 billion, including $5.1 billion of equity and $1.9 billion of debt. Air Products said the acquisition is expected to be immediately accretive to earnings.

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Air Products, in a press statement, said a combination of the two companies would create the largest industrial gas company in North America and one of the largest in the world. Air Products said cost synergies of $250 million would be recognized by the end of the combination's second year.

Air Products said it is "fully committed to pursuing this transaction" and has secured financing from

JPMorgan Chase

to complete the offer. Air Products also said it's "prepared to make appropriate divestitures to address regulatory issues."

While it remains our strong desire to reach an agreement with Airgas on a friendly basis, we are fully committed to pursuing this transaction and are prepared to take all necessary steps to complete it, including making an offer directly to Airgas shareholders," said John McGlade, Air Products chairman and CEO, in a statement.

McGlade wrote in a letter to Peter McCausland, CEO of Airgas, that he was "disappointed" that two previous offers were rebuffed over the last four months, the

New York Times

reports. The CEOs met several months ago and agreed on the merits of a merger, but Airgas has since refused to consider any approach from Air Products, the


adds, citing people briefed on the matter.

-- Reported by Joseph Woelfel in New York.

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