Airgas Company Archives - Page 8 of 10 - Modern Distribution Management

Latest In Airgas

For nearly a year now, Air Products has been fighting to buy industrial gases and hardgoods distributor Airgas. The fight has prompted the question: How likely is it that Air Products will succeed?

To learn more about the mechanics of undertaking a hostile takeover bid, MDM spoke with Jim Hill, executive chairman of Ohio-based Benesch and chairman of the law firm’s private equity practice. Hill provided background on the topic, examples of other deals, and the challenges inherent with this approach.

Nearly every distributor took a beating in 2009. A few are still getting kicked while they’re down. If you’re a competitor to Airgas or HD Supply, that turmoil couldn’t come at a better time.

Case 1: Airgas is in a fight for its life. In February, Air Products made a hostile bid for Airgas. It has been getting more hostile since. The investor analysis by Air Products is at www.airgasoffer.com. And here are the documents Airgas has produced for its investors to fight the offer.

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This is the MDM Public Distributor Report, provided on a quarterly basis to subscribers of Modern Distribution Management. This report includes an overview of public distributor earnings calls, Airgas and Air Products acquisition talk, and financial metrics for publicly traded distribution companies.

This is the MDM Public Distributor Report, provided on a quarterly basis to subscribers of Modern Distribution Management. This report includes an overview of public distributor earnings calls, Airgas and Air Products acquisition talk, and financial metrics for publicly traded distribution companies.

The first few days of 2010 have already produced a number of announcements regarding deals in distribution and manufacturing sectors. There are a relatively high percentage of distressed sales, but some healthy companies are in play, as well. There are some excellent opportunities to build value in this part of the cycle. It’s a fundamentally different M&A landscape than just a few years ago when valuations were sky high, and distribution markets were the hot ticket for investment funds.

Airgas, Radnor, PA, outlined its growth strategies and successes in its annual analyst meeting in December. Here is an overview of the key areas covered by the gases and welding hardgoods distributor.

Product and Segment Focus
According to Airgas, about 30 percent of its total sales go to customer segments that are “growing faster than GDP.” Strategic products, a group of five product areas, account for 40 percent of sales. Those are: Bulk, Medical, Specialty Gas, CO2/Dry Ice, and Safety Products. These product areas have grown faster than Airgas’ other core business, COO Michael Molinini told analysts, and the areas cater to “favorable customer segments.”

One growth driver for these areas is cross-selling. For example, …

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