Yingde shares at 20-month high on Air Products’ interest to bid

PAG Asia Capital, one of Asia’s largest private equity buyout funds, has now offered HK$6 per share to Yingde’s three founding shareholders

PUBLISHED : Thursday, 02 March, 2017, 9:55am
UPDATED : Thursday, 02 March, 2017, 4:34pm

Shares of Yingde Gases Group Co., one of China’s largest suppliers of industrial gases for steel mills and chemical plants, soared to their highest level in 20 months, after a US-based company affirmed its interest to submit a bid a takeover bid.

Yingde rose 2.7 per cent to an intraday high of HK$6.40 before ending the day at HK$6.31, the highest level since June 1, 2015. The stock has risen 17.5 per cent this week.

Air Products & Chemicals Inc, which supplies oxygen and other industrial gases to chemical plants, said it’s still in the bidding process for control of Yingde, according to a statement, after its December 2016 non-binding offer was matched on Wednesday by buyout fund PAG Asia Capital.

“Air Products plans to continue to participate in the sale process being conducted by Yingde,” said the company based in Allentown, Pennsylvania, according to an emailed statement. “We believe that the combination of Yingde and Air Products makes significant strategic and financial sense and would be of great benefit to investors, customers and employees of both companies.”

PAG Asia Capital offered HK$6 per share to Yingde’s three founding shareholders, with a combined 41.9 per cent stake in the business, on the condition that it can eventually own more than 50 per cent of the gas company.

Its offer is not subject to other conditions.

The offer price is at the top end of the HK$5.50 to HK$6 price range offered on January 20 by Air Products, in what could potentially have been the largest US takeover of a Chinese company in a decade.

Both Yingde and Air Products supply oxygen and other industrial gases to steel mills and chemical plants.