Yingde Gases shares surge on takeover approach by American rival Air Products
The second potential takeover bid for Shanghai-based Yingde comes amid a bitter dispute between two groups of current and ousted directors
Shares of Yingde Gases Group, one of China’s largest suppliers of industrial gases to the steel and chemical sectors, have risen as much as 22 per cent to their highest in a month, after the company said American rival Air Products had expressed an interest in taking it over.
It is the second potential takeover bid Shanghai-based Yingde has received recently and comes amid a bitter dispute between two groups of current and ousted directors over the introduction of a Shenzhen-based firm in an unrelated business as a shareholder to help it repay debt.
Pennsylvania-based Air Products sent each of Ying’s board directors a letter expressing an interest in buying the company with a cash offer just over a week ago, Yingde said in a filing to Hong Kong’s bourse on Monday, adding the interest is “non-legally-binding.”
“The majority board [excluding ousted chief executive Sun Zhongguo and former chief operating officer Trevor Strutt] considers that while it is not appropriate to disclose further details at this stage, it would be prudent to hold a board meeting on [Tuesday] to consider the same,” Yingde said.
Air Products also issued a statement saying the expression of interest is “preliminary” and is “subject to the satisfaction of certain conditions described in the proposal letter” without elaborating on the conditions.
Yingde in early November re-designated Sun and Strutt from executive to non-executive directors, citing their “unsatisfactory performance”. Sun’s chief executive position was taken up by He Yuanping, chief financial officer of Shenzhen-listed waste-water treatment firm Beijing OriginWater Technology.