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Posts Tagged ‘airgas’

Helium Shortage Puts GAWDA Members In The Spotlight

Tuesday, July 24th, 2012

Still-Leben Mülheim 10 iesWhen it comes to questions about gases and welding equipment, it’s no secret that GAWDA members have a great deal of expertise. In my experience, they’re also very willing and eager to share this expertise with others. I couldn’t even begin to measure just how much I’ve learned about the industry from GAWDA members.

With the helium shortage all over the news, local newspapers and TV stations have turned to GAWDA distributors to tap into this expertise and learn about the helium supply situation. While a product shortage may not be a boon to business, it has no doubt provided some exposure for these distributors.

Here are some of the distributors who have appeared in recent news stories:

Norco (Boise, ID) has been interviewed by several news sources. President Ned Pontious told KTVB, “Obviously the price on helium has been increasing quite dramatically, but what’s really frustrating is when price is not an issue and you still can’t get the product. We’re willing to pay whatever we can pay to get it, but we can’t get it.” Pontious was also interviewed by another area TV station, and the company made an appearance on news station KREM2.

Mike Storie, vice president of sales at Haun Welding Supply (Syracuse, NY), told The Post-Standard that the company has 1,000 empty cylinders that should be full of helium. “We see no signs of it going backward.” Store Manager Brian McDonald was also interviewed by a local TV station, and Sales Manager Grant Hanlon spoke with an area newspaper.

In Wichita, KS, Lampton Welding Supply President Guy Marlin was quoted in the Wichita Business Journal: “It’s probably not going to change for a while. We’re fortunate that we’ve been able to hang in there.”

nexAir (Memphis, TN) Senior VP Steve Atkins told The Commerical Appeal, “Everything we read and see leads us to expect to see more cost increases in the future.”

“Helium in the earth is depleting, not as much as there use to be, demand has gone up somewhat, and it’s a worldwide product now,” said Melo’s Gas & Gear (Bakersfield, CA) President Dave Melo in an interview with a local TV station.

Noble Gas Solutions (Albany, NY) President and CEO Dave Mahoney told with the Times Union, “The last thing I want to do is see a welding operation lay people off … so I can watch a bunch of balloons at a parade.”

“We are trying to spread it out so everybody gets something,” Michael Sutley, OXARC (Spokane, WA) vice president and general manager, told the Tri-City Herald.

An update on Weldstar’s (Aurora, IL) website was quoted by the Pharos-Tribune as saying, “Along with many other distributors, Weldstar is feeling the effects of a global helium shortage, which is expected to last up to three years.”

In Bend, OR, Airgas Branch Manager Phil Price told The Bend Bulletin, “As far as we know, we could see the end of helium-filled balloons.”

In these interviews, GAWDA members offered some great insights into the helium supply situation. Reading through these articles, I realized that having access to this incredible network of industry members is something that I take for granted at times…after all, I get to speak with members about a variety of business and industry related topics on a daily basis (whereas it takes an event like the helium shortage for mainstream media outlets to pick up the phone) . All I can say is it’s about time that the general public got to see how knowledgeable and well-spoken GAWDA members are.

If I left your company out of the list of news appearances about the helium supply, feel free to add a link in the comments area.

How To Build A Business Plan With One Question

Tuesday, May 8th, 2012

GAWDA member Airgas (Radnor, PA) recently announced the major news that it will undergo a leadership transition. Company founder Peter McCausland will take on the role of executive chairman of the board as EVP Mike Molinini steps into the role of president and CEO this August.

During Airgas’ recent earnings call, McCausland said, “This transition is a product of extensive leadership succession planning.” He added that the transition is “a natural result of the Board’s long-term focus on developing a deep management team and it represents the next step in the evolution of Airgas.”

As a business, it’s always ideal when you can move forward and grow on your own terms. In this case, Airgas clearly had a plan in place to help steer the company’s progress for years to come.

Whether it’s succession, sales or another facet of the business, a strategic plan can be a powerful business tool. Some organizations choose only to prepare a plan when required by an investor or bank—but as GAWDA members told Welding & Gases Today, having a plan can keep the business on track and making progress toward state goals.

In the strategic planning article “Working Your Plan,” Capitol Welders Supply (Baton Rouge, LA) Vice President Kelly Root shared the somewhat philosophical question at the foundation of his company’s business plan. “We approached our plan by asking ‘What would we want our business to look like if we floated off in a hot air balloon and landed seven years later?” he says. This one question allowed Capitol Welders Supply to visualize long-term goals, and then define a year-by-year plan to define the steps required to reach these goals, be they based in processes, technologies, finances, leadership or otherwise.

Root and Capitol Welders have found a great way to handle the challenge of business planning. Now I extend the challenge to you. If you floated off in a hot air balloon and returned seven years later…what would you want your business to look like?

Airgas and Air Products: Getting Up To Speed

Tuesday, December 14th, 2010

Airgas and Air Products: Getting Up To SpeedThere have been some major developments in the Airgas/Air Products situation, and yet the uncertainty of the situation is as strong as ever. In case you missed it, here’s what’s happened in the last two weeks.

At the end of November, the Delaware Supreme Court made a pivotal decision to repeal the Air Products’ proposed amendment that would have moved Airgas’ next annual meeting up to January 18, 2011, effectively shortening the Airgas directors’ terms by eight months. Given that at September’s meeting, three Air Products-nominated board members were voted onto the Airgas board, the Supreme Court decision was a big win for Airgas.

Soon after, on December 9, Air Products upped its bid of $65.50 up to $70.00, calling the offer its “best and final offer.” According to the Air Products statement, “The reality is that there are no other bidders for Airgas.” Airgas is currently reviewing the offer, and has yet to make a determination. However, Airgas previously stated that its board “unanimously” held $78 to be a starting point for negotiations.

As it turns out, this valuation may not have been unanimous as previously thought. The three directors nominated by Air Products wrote a letter to the chairman expressing this sentiment. The chairman quickly acquiesced to the directors’ request to obtain a third consulting firm for their benefit. But as NY Times’ Dealbook shrewdly points out, the consulting firm was likely chosen by the other six board members. It seems there may be dissention among the board—so we will watch and see where this leads.

So where do we stand?

Both parties are waiting on the Delaware Chancery Court to decide on whether to redeem the so-called poison pill (so-called by Delware  Chancellor William B. Chandler III in a letter), a measure to protect against hostile takeovers. According to Investopedia’s definition, a poison pill would make Airgas’ stock less attractive to Air Products, generally by diluting the shares and making the takeover more expensive. The judge stated today that he will not make a decision until the new year.

With the annual meeting pushed back from January, there is currently no finalized date for the meeting. Airgas writes in a response to the Delaware Chancery Court on December 10, “[Airgas] does not intend to hold its next annual meeting before June when its fiscal year 2011 results will be available and its annual report issued.” On August 30, 2010, Airgas offered to move its annual meeting up to June 21, 2011, in an attempt to leverage votes against the Air Products by-law proposal. Given that Airgas now controls the meeting date, it is more likely that the meeting will take place in September or October 2011. However, according to NY Times’ Dealbook, an Airgas by-law requires a supporting vote of only 33 percent of shareholders to call a special meeting. As such, Air Products may attempt to rally Airgas shareholders to move the meeting up to June.

As we wait for a resolution that may still be a long way off, I can only wonder what impact the situation will have on the industry. If Air Products takes over, how will it impact you? Will there be any residual effect if Airgas wins out? Let me know what you think.

What You Need To Know About Airgas vs. Air Products (Part II)

Thursday, September 9th, 2010

AirgasThe Airgas/Air Products war wages on. This week Air Products upped its offer by $2 a share, bringing the offer that started at $60 per share up to $65.50 per share. Shortly after, Airgas promptly reviewed and rejected the offer.

But this will not go on forever. Air Products CEO John McGlade says the company can take a hint: “If Airgas shareholders do not elect these three nominees and approve all of our proposals, we will conclude that shareholders do not want a sale of Airgas at this time—and we will therefore terminate our offer.”

But if you ask Airgas’ Peter McCausland, he’s not buying it: “We believe that Air Products’ threat to withdraw its offer if Airgas stockholders do not elect its nominees and approve its By-Law proposals is just another coercive tactic designed to facilitate the acquisition of Airgas at the lowest possible price.”

Just when it looked like a vote on September 15 could definitively determine Airgas’ fate, the situation is back up in the air. The latest subtext of the back-and-forth is that Airgas may seek other suitors. Says McCausland, “If the January Meeting Proposal does not receive support from a majority of the votes…our Board will explore all available alternatives to the grossly inadequate Air Products offer in order to enhance stockholder value.” According to Bloomberg, “alternatives” typically involves soliciting bids from other potential buyers. Could Airgas be up for sale?

If it seems as though Air Products will not give up, it may be because of the two companies’ history. Air Products sold its U.S. packaged gas business to Airgas in 2002. Now Air Products wants it back, by way of purchasing Airgas. McGlade explains, in a letter to Airgas employees:

“You might be wondering why we are looking to return to the U.S. packaged gas business now. In 2002, our U.S. packaged gas business had limited breadth and scope and at that time, we examined our strategic priorities and decided to exit that business in order to focus on other areas where we could grow and improve our company. Over the ensuing eight years, both Air Products and Airgas have grown significantly, and as we look to the future, we see packaged gas as a growth area for Air Products, both within North America and internationally.”

Even if you do not have a direct stake in this, the potential of a merger could have serious implications for the competition. John McGlade, in a letter to Airgas employees states, “The combined company would be the largest industrial gas company in North America and one of the largest globally.”

What impact do you think this will have on your company?

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Making Sense Of The Battle For Airgas

Tuesday, August 31st, 2010

If you’re anything like me, you don’t know what to make of the controversy between Airgas and Air Products. Air Products has been trying to acquire Airgas for about 10 months, and everything seems like a carefully played chess match leading up to Airgas’ annual meeting on September 15. As it approaches, I’ve been trying to get a grasp on everything that has taken place.

The feud has now made its way into a New York Times blog from UConn Law Professor Steven M. Davidoff, which dissects the latest moves by each party involved and their potential implications. Why did Airgas send a letter to the Delaware court? Why exactly is Air Product proposing a bylaw amendment to move Airgas’ next annual meeting all the way up to January 2011? Davidoff puts it in terms you can wrap your head around. NB – It’s infused with Davidoff’s opinion, so don’t take it all as fact.

Last week, Airgas sent a letter to its shareholders stating, among many other things, “If Air Products truly wants to acquire Airgas, it knows what to do. It must offer a price that fairly compensates you—our stockholders—or terminate its efforts.”

The NYT blog brings up an important point that seems to draw on this statement: “Whether Airgas intended it, the events of this week tell the market that it certainly is for sale at the right price.”

Is a takeover imminent? What impact do you think it will have on other distributors if it happens?