Air Products has issued a formal response to yesterday’s news that Airgas stockholders have elected Air Products' three nominees. The North American company reacted positively to proposal approvals and nominations but argued that, “Airgas’ lawsuit is completely without merit.”
John E McGlade, Air Products’ Chairman, President and CEO, commented, “Airgas shareholders have provided a clear mandate to negotiate immediately and call on the Airgas Board to respect the will of its shareholders. Further delay serves no purpose.”
The big news
Yesterday, Air Products’ three director nominees were elected to the Board of Directors of Airgas. These included John P Clancey, Robert L Lumpkins and Ted B Miller Jr. In addition, three of the company’s proposals received approval:
• A proposal amending Airgas’ By-Laws to limit the Airgas Board’s ability to re-seat directors not elected by Airgas shareholders (excluding the Chief Executive Officer)
• A proposal requiring future Airgas annual shareholder meetings, including for 2011, to be held in January
• A proposal repealing all By-Law amendments adopted by the Airgas Board after April 7, 2010
The rub
Nevertheless, not all decisions were regarded favourably, particularly when Airgas, Inc. filed litigation with the Delaware Chancery Court regarding the outcome of the Airgas Annual Meeting. In response, Air Products accuses the firm of “attempting to invalidate a vote of its shareholders” who approved the by-law proposals listed above.
Air Products released the following statement: “Airgas’ lawsuit is completely without merit. Today the Airgas shareholders determined the date of the next Airgas annual meeting. The Airgas Board should respect the will of its shareholders, drop this baseless litigation and begin negotiations with us immediately. Airgas shareholders had a chance to speak today and provided a clear mandate to negotiate a transaction; their will should be respected.”
Yesterday, Airgas justified legal action through an official statement: “[We] believe that this proposal is invalid under Delaware law and Airgas’ certificate of incorporation and by-laws. Nonetheless, it is the Airgas Board of Directors’ intention that any effort to reappoint Mr McCausland to the Board of Directors be done in accordance with the procedure set forth in the proposed by-law amendment.”