Air Products v. Airgas

Summary

Air Products v. Airgas involves a hostile takeover attempt by Air Products, and the validity of the Airgas shareholder rights plan, or "poison pill."

Air Products initially offered $60 per share to purchase Airgas in February 2010, and repeatedly increased its offer until September 2010, when Air Products offered $65.50 per share, endorsed three candidates to the then 9-member Airgas board, and also sponsored a resolution advancing the next annual meeting to January, 2011, at which time Air Products would presumably attempt to take control of the Airgas board with three more endorsed candidates.

After a five-day trial webcast live by CVN in October 2010, the Court of Chancery ruled that the bylaw change advancing the annual meeting was valid.

However, the Delaware Supreme Court heard an appeal, also webcast live by CVN, and ruled that Airgas could not use a bylaw change supported by a simple majority to hold two "annual" meetings four months apart.

In December, 2010, Air Products increased its offer to $70 per share -- its "best and final offer" -- and Airgas again rejected the offer, maintaining that $78 per share was the proper valuation.

In January 2011, the Court of Chancery heard Air Products' request that the Court invalidate the Airgas poison pill. Airgas had to explain why its shareholders should be prevented from accepting the $70 offer, and Air Products had to show why the $70 offer is adequate.

The Court concluded that the Airgas board could reject the $70 per share offer, and that the poison pill did not have to be redeemed.

Air Products is represented by Cravath; Airgas by Wachtell Lipton.

Watch the October 2010 trial.
Watch the November 2010 Supreme Court hearing.
Watch the January 2011 supplementary evidentiary hearing before Hon. Chancellor William B. Chandler III, in Georgetown, Delaware.

For move information, visit the CVN News Blog.

Outcome

The court found that the bylaw change advancing the annual meeting was valid