Moody's upgrades Airgas

Moody's Investors Service said it raised Airgas Inc.'s issuer rating and senior notes to Baa2 from Baa3 and its senior subordinated notes to Baa3 from Ba1.

The outlook is stable.

These actions follow the termination of an unsolicited takeover offer by Air Products and Chemicals, Inc. and the announcement of a $300 million share buyback program earlier this week. Airgas' ratings had been placed under review following the announcement of the unsolicited takeover offer in February 2010.

The agency said Airgas' upgrade reflect its strengthening financial performance, solid free cash flow generation along with the expectation that the company will not pursue further large debt-financed share buyback programs.

Airgas' Baa2 ratings are also supported by the company's leading market share in packaged gases in North America, increasing customer density due to bolt-on acquisitions and the stability of its earnings and cash flow, Moody's said.

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