* Calls latest Air Products offer 'opportunistic'
* EPS ex-items of 83 cts tops Wall St view 72 cts
* Revenue up 7.2 percent to $1.05 billion
* Raises full-year profit forecast, quarterly dividend
* Shares fall 0.3 pct
(Adds CEO interview, updates stock movement)
By Ernest Scheyder
NEW YORK, July 21 Industrial gas company Airgas
Inc ARG.N rejected the latest hostile takeover offer from
rival Air Products & Chemicals (APD.N) on Wednesday after
posting a higher-than-expected quarterly profit and rebounding
Repeating a now-familiar mantra, Airgas said Air Products'
recently increased offer of $63.50 per share is "extremely
opportunistic" and does not take the company's growth potential
In an interview with Reuters, Airgas founder and Chief
Executive Peter McCausland declined to say what offer would
"I'm not going to speculate on any numbers," said
McCausland, who owns about 10 percent of the company's stock.
"We have one bid on the table and it's grossly inadequate. We
can do a lot better and create a lot more value by executing on
our own plan."
The rejection came the same day as the company's earnings
release, as well as a dividend increase and boost to the fiscal
2011 profit forecast.
"We just felt it was really appropriate to time our
rejection with the release of our earnings," McCausland said.
Air Products said Wednesday it was "disappointed" that
Airgas had again rejected the offer, which expires August 13.
Air Products said it will move forward with a plan to put three
directors on Airgas' board at the next shareholder meeting,
which much be held before October.
Wall Street yawned after the exchange, with Airgas shares
falling only 0.3 percent to $65.36 in afternoon New York Stock
The stock jumped just after Air Products made its bid early
this year, though McCausland said he is not worried Airgas
shares would drop if the bid is withdrawn.
"I don't think it would fall too much," he said. "The
market is saying that Air Products' bid is grossly
Jefferies & Co analyst Laurence Alexander said Airgas
looked poised to benefit from both faster-than-GDP growth and
strong free cash flow generation.
However, the buyout saga with Air Products will probably
take some time, making the risk-and-reward balance seem less
favorable, said Alexander, who affirmed a "hold" rating on the
Airgas produces about 30 percent of the gas it sells, but
has long-term contracts for the remaining 70 percent. Air
Products is one of its largest suppliers.
"There would be serious repercussions if any company
breached those contracts," McCausland said.
BY THE NUMBERS
Net earnings for the Radnor, Pennsylvania-based company's
first quarter ended June 30 rose to $64.8 million, or 76 cents
per share, from $54.8 million, or 66 cents per share, a year
Excluding one-time items, earnings per share of 83 cents
topped the 72 cents that analysts had on average expected,
according to Thomson Reuters I/B/E/S.
Revenue rose 7.2 percent to $1.05 billion.
Same-store sales, typically sales at stores open at least
12 months, rose 6 percent, due mostly to higher volume.
Airgas forecast second-quarter profit at 78 cents to 82
cents per share.
For the full year, the company said it expected earnings of
$3.15 to $3.30 per share, up from its previous estimate of
$2.95 to $3.05. Analysts expect $3.04.
The company raised its quarterly dividend to 25 cents per
share from 22 cents.
(Reporting by Ernest Scheyder and Matt Daily; editing by
Gerald E. McCormick, Lisa Von Ahn and Gunna Dickson)