- Air Liquide to acquire U.S.-based
Airgas for U.S. $143 per share in cash, or a total enterprise value
of $13.4 billion
- Game-changing combination that
strengthens Air Liquide’s global leadership with #1 position in
North America, complementing its #1 positions in Europe, Africa /
Middle East and Asia-Pacific, and provides new opportunities to
Airgas customers
- Air Liquide ideally positioned for
future growth with a stronger presence in the U.S., the largest
industrial gases market in the world
- The transaction is expected to be
accretive from year one
- Combined company to deliver greater
value, service and innovation to customers in North America and
around the world
Air Liquide (Euronext Paris:AI), world leader in gases,
technologies and services for Industry and Health, and Airgas
(NYSE:ARG), one of the leading suppliers of industrial gases and
associated products and services in the U.S., today announced an
agreement under which Air Liquide will acquire Airgas. Airgas
shareholders will receive $143 per share in cash for all
outstanding shares of Airgas, representing a total enterprise value
of $13.4 billion (€12.5 billion at current exchange rates1) on a
fully diluted basis and including the assumption of Airgas
debt.
The transaction represents a premium of +50.6% to Airgas’ one
month average share price, prior to the announcement of the
transaction, and of +20.3% over Airgas’ 52-week high share
price1.
In the transaction, Airgas will become a wholly-owned subsidiary
of Air Liquide.
Benoît Potier, Chairman and CEO of Air Liquide, said:
“This combination offers significant benefits for all of our
stakeholders due to the highly complementary nature of the two
businesses. It also advances Air Liquide’s vision to lead the
industry and deliver long-term performance while acting
responsibly. This acquisition increases our geographic reach in the
resilient U.S. market, and offers continuous growth opportunities.
Airgas is the industry leader in U.S. packaged gases with a
customer-centric organization and we are confident in our ability
to successfully combine operations. Airgas is a unique partner, and
together we will continue to advance our strategy based on
profitable growth and innovation over the long-term.”
He added, “We have the highest respect for Airgas, its
organization, its employees and its stakeholders, as well as for
what they have achieved over more than 30 years. We look forward to
working with their teams as we move to complete the transaction and
combine both businesses.”
Peter McCausland, Executive Chairman of Airgas, said:
“This transaction is compelling for our shareholders, arising
from the persistent execution of our business strategy for more
than three decades. Air Liquide’s long-term vision and strong
heritage in the U.S. make it the right fit for our valued
customers, and the combination creates significant opportunities
for the talented employees of both companies. Airgas customers and
employees will benefit from Air Liquide’s unrivalled global
footprint and strength in technology, innovation and operational
efficiency, while Airgas is ready to bring the entrepreneurial
culture and packaged gas excellence that have driven our success to
date. We are excited about the prospects of integrating these two
businesses to create the largest industrial gas company in the
world. We look forward to working closely with Air Liquide to
complete the transaction and achieve a smooth transition.”
Strategic Rationale
Combining Air Liquide and Airgas will bring together two highly
complementary businesses to deliver greater value, service and
innovation to customers in North America and around the world. In
the U.S., Airgas’ leadership in the packaged gases business and
associated products and services and Air Liquide’s strong footprint
in complementary activities will increase the scope and
competitiveness of the combined companies’ product offering.
This acquisition gives Air Liquide a greater presence in the
U.S. market, the largest for industrial gases worldwide, and will
ideally position Air Liquide for future growth. In addition, there
is potential for further growth using Airgas’ footprint to
accelerate the deployment of Air Liquide’s technologies.
The combination builds on Air Liquide’s longstanding track
record of successfully operating in the U.S. and will benefit from
Airgas’ unmatched national presence and its more than 1 million
customers in the U.S., as well as from its leading customer-facing
platform including e-commerce and telesales capabilities. The
combined entity will be able to better serve customers with the
most advanced multi-distribution networks in the U.S. and more
competitive product offerings thanks to an integrated
upstream-downstream model.
The acquisition will reinforce Air Liquide’s global leadership
position, increasing Gas & Services sales by around + 30%. Upon
completion of the acquisition, the combined company will be the
leader in North America, complementing number one positions in
Europe, Africa/Middle East and Asia-Pacific. It will also be number
one in Industrial Merchant and Large Industries, and co-number one
in Electronics, worldwide.
The combined company will continue to implement an innovation
strategy that combines scientific expertise, industry-leading
technology and customer insight to bring new products and services
to market. It will also improve existing offerings and open new
markets, in particular by leveraging digital technologies. In
addition, this combination will create new opportunities for
employees as part of a leading global organization that is ideally
positioned for growth.
Financial Benefits
Air Liquide’s acquisition of Airgas represents significant value
for shareholders of both companies. Upon completion, Airgas
shareholders will receive immediate and substantial cash value for
their shares.
Air Liquide’s management has a proven track record of executing
and integrating acquisitions. The transaction is expected to be
accretive from year one. Air Liquide plans to realize more than
$300 million of pre-tax cost, efficiency and volume synergies; the
majority within two to three years. The company’s objective is to
maintain its S&P ‘A-/A’ credit rating. Air Liquide has
committed bridge financing for the transaction and intends to
refinance through a capital increase in the range of €3 billion to
€4 billion, and a combination of U.S. dollar and Euro long-term
bonds.
Timing and Conditions
The transaction is subject to Airgas shareholders’ approval,
receipt of necessary antitrust and other regulatory approvals and
other customary conditions and provisions. The two parties wish to
proceed swiftly.
Board Approvals and Process
The transaction has been unanimously approved by each of Airgas’
and Air Liquide’s boards of directors, including Executive Chairman
of Airgas Peter McCausland who is a significant shareholder, and an
ad hoc committee of the Air Liquide board was established to
participate in the process that led to the agreement between Airgas
and Air Liquide.
Barclays Bank Plc and BNP Paribas are acting as financial
advisors to Air Liquide, and also as underwriters of the bridge
financing. Cleary Gottlieb Steen & Hamilton LLP and Bredin Prat
are acting as legal advisors to Air Liquide.
Goldman Sachs and Bank of America Merrill Lynch are acting as
financial advisors to Airgas and Wachtell, Lipton, Rosen & Katz
is acting as legal advisor to Airgas.
On Wednesday, 18 November 2015
Investor Calls at 8:30am CET and at
5:30pm EST
Press Conference at 10:00am CET at Pavillon Gabriel, 75008
Paris
Investor Calls Details
Investor call 1, at 8:30 am Paris
time (London 7:30 am, New York 2:30 am)
(UK) +44 (0)20 3427 1910 and 4056934#
(FR) +33 (0)1 70 48 01 66 and 4056934#
(US) +1-212-444-0412 and 4056934#
Investor call 2, at 5:30 pm New York
time (Paris 11:30 pm, London 10:30 pm)
Dial-In:
(US Toll) +1-212-999-6659
(US Toll Free) +1-866-966-5335
Replay – available for 7 days:
(US Toll Free) +1-866-595-5357 and 6648317#
Press Conference Details
10:00-10:45 CET at Pavillon
Gabriel - 5 Avenue Gabriel, 75008 Paris.
Held by Benoît Potier, Chairman and CEO of Air Liquide, and
Fabienne Lecorvaisier, CFO.
It will be possible to listen to the press conference by
dialing: (FR) +33 (0)1 76 77 22 30 and 9174705# or (UK) +44 (0)20
3427 1916 and 9174705# (listen
only)
About Air Liquide
World leader in gases, technologies and services for Industry
and Health, Air Liquide is present in 80 countries with more than
50,000 employees and serves more than 2 million customers and
patients. Oxygen, nitrogen and hydrogen have been at the core of
the company’s activities since its creation in 1902. Air Liquide’s
ambition is to be the leader in its industry, delivering long-term
performance and acting responsibly.
Air Liquide ideas create value over the long term. At the core
of the company’s development are the commitment and constant
inventiveness of its people.
Air Liquide anticipates the challenges of its markets, invests
locally and globally, and delivers high-quality solutions to its
customers and patients, and the scientific community.
The company relies on competitiveness in its operations,
targeted investments in growing markets and innovation to deliver
profitable growth over the long-term.
Air Liquide’s revenues amounted to €15.4 billion in 2014, and
its solutions that protect life and the environment represented
more than 40% of sales. Air Liquide is listed on the Paris Euronext
stock exchange (compartment A) and is a member of the CAC 40
and Dow Jones Euro Stoxx 50 indexes.
For more information, please visit www.airliquide.com.
About Airgas
Airgas, Inc. (NYSE: ARG), through its subsidiaries, is one of
the nation’s leading suppliers of industrial, medical and specialty
gases, and hardgoods, such as welding equipment and related
products. Airgas is a leading U.S. producer of atmospheric gases
with 16 air separation plants, a leading producer of carbon
dioxide, dry ice, and nitrous oxide, one of the largest U.S.
suppliers of safety products, and a leading U.S. supplier of
refrigerants, ammonia products, and process chemicals.
Approximately 17,000 associates work in more than 1,100 locations,
including branches, retail stores, gas fill plants, specialty gas
labs, production facilities and distribution centers. Airgas also
markets its products and services through e-Business, catalog and
telesales channels. Its national scale and strong local presence
offer a competitive edge to its diversified customer base.
Airgas revenues amounted to $5.3 billion in 2015 (fiscal year
ending March 31, 2015).
For more information, please visit www.airgas.com
Cautionary Note Regarding Forward-Looking Statements
This press release contains certain statements that are
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, as amended. L’Air Liquide S.A. (“Air
Liquide”) and Airgas, Inc. (“Airgas”) have identified some of these
forward-looking statements with words like “believe,” “may,”
“could,” “would,” “might,” “possible,” “will,” “should,” “expect,”
“intend,” “plan,” “anticipate,” or “continue,” the negative of
these words, other terms of similar meaning or the use of future
dates. Forward-looking statements in this release include without
limitation statements regarding the expected timing of the
completion of the transactions described in this press release, Air
Liquide’s operation of Airgas’ business following completion of the
contemplated transactions, and statements regarding the future
operation, direction and success of Airgas’ businesses. Such
statements are qualified by the inherent risks and uncertainties
surrounding future expectations generally, and actual results could
differ materially from those currently anticipated due to a number
of risks and uncertainties. Risks and uncertainties that could
cause results to differ from expectations include: uncertainties as
to the timing of the contemplated transactions; uncertainties as to
the approval of Airgas’ stockholders required in connection with
the contemplated transactions; the possibility that a competing
proposal will be made; the possibility that the closing conditions
to the contemplated transactions may not be satisfied or waived,
including that a governmental entity may prohibit, delay or refuse
to grant a necessary regulatory approval; the effects of disruption
caused by the announcement of the contemplated transactions making
it more difficult to maintain relationships with employees,
customers, vendors and other business partners; the risk that
stockholder litigation in connection with the contemplated
transactions may affect the timing or occurrence of the
contemplated transactions or result in significant costs of
defense, indemnification and liability; other business effects,
including the effects of industry, economic or political conditions
outside of the control of the parties to the contemplated
transactions; transactions costs; actual or contingent liabilities;
and other risks and uncertainties discussed in Airgas’ filings with
the U.S. Securities and Exchange Commission (the “SEC”), including the “Risk Factors” sections of
Airgas’ most recent annual report on Form 10-K. You can obtain
copies of Airgas’ filings with the SEC for free at the SEC’s
website (www.sec.gov). Neither Air Liquide nor Airgas undertakes
any obligation to update any forward-looking statements as a result
of new information, future developments or otherwise, except as
expressly required by law. All forward-looking statements in this
announcement are qualified in their entirety by this cautionary
statement.
Additional Information and Where to
Find it
Airgas intends to file with the SEC a proxy statement in
connection with the contemplated transactions. The definitive proxy
statement will be sent or given to Airgas stockholders and will
contain important information about the contemplated transactions.
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE PROXY
STATEMENT CAREFULLY AND IN ITS ENTIRETY WHEN IT BECOMES AVAILABLE.
Investors and security holders may obtain a free copy of the proxy
statement (when it is available) and other documents filed with the
SEC at the SEC’s website at www.sec.gov.
Certain Information Concerning
Participants
Airgas and its directors and executive officers may be deemed to
be participants in the solicitation of proxies from Airgas
investors and security holders in connection with the contemplated
transactions. Information about Airgas’ directors and executive
officers is set forth in its proxy statement for its 2015 Annual
Meeting of Stockholders and its most recent annual report on Form
10-K. These documents may be obtained for free at the SEC’s website
at www.sec.gov. Additional information regarding the interests of
participants in the solicitation of proxies in connection with the
contemplated transactions will be included in the proxy statement
that Airgas intends to file with the SEC.
1 Calculated as of Monday November 16th, 2015
View source
version on businesswire.com: http://www.businesswire.com/news/home/20151117006812/en/
Air LiquideMedia relationsAnnie Fournier, +33 (0)1
40 62 51 31annie.fournier@airliquide.comorCaroline Philips, +33
(0)1 40 62 50 84caroline.philips@airliquide.comorFor Air Liquide
USAMichael Rosen, +1-
713-624-8023michael.rosen@airliquide.comorBrunswick
GroupSteven Lipin, +1-212-333-3810orInvestor
relationsAude Rodriguez, +33 (0)1 40 62 57
08aude.rodriguez@airliquide.comorErin Sarret, +33 (0)1 40 62 57
37erin.sarret@airliquide.comorLouis Laffont, +33 (0)1 40 62 57
18louis.laffont@airliquide.comorJérôme Zaman, +33 (0)1 40 62 59
38jerome.zaman@airliquide.comorAirgasMedia
relationsSarah Boxler,
+1-610-263-8260sarah.boxler@airgas.comorJoele Frank, Wilkinson
Brimmer KatcherDan Katcher / Andrew Siegel / Jim Golden+
1-212-355-4449orInvestor relationsJoseph Marczely,
+1-610-263-8277joseph.marczely@airgas.com
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