Airgas sells Rutland Tool to Lawson Products

Airgas Inc. announced a definitive agreement to sell the assets and operations of Rutland Tool & Supply Co., a Whittier, Calif.-based Airgas subsidiary, to Lawson Products.

Rutland Tool, which distributes metalworking tools, machine tools and MRO supplies from seven locations and has about 180 employees, generated $47 million in sales in the fiscal year ended March 31, 2005. The closing is expected on or before December 1, 2005, subject to customary closing conditions. Proceeds of the sale will be approximately $15 million at closing with subsequent consideration for trade receivables paid as they are collected.

As a result of the sale, Airgas will reflect the operating results of Rutland Tool as discontinued operations and will recognize a loss on the sale of approximately $2.3 million after-tax or $0.03 per diluted share in the third quarter ended December 31, 2005. The loss principally relates to the write-off of leasehold improvements and lease termination costs for long-term lease commitments that are not being assumed by the purchaser. Earnings from continuing operations for the third quarter and fiscal 2006 are expected to be within the previously forecast range of $0.37 to $0.39 per diluted share and $1.50 to $1.56 per diluted share, respectively. The sale will not materially affect future earnings.

Airgas will retain its facility in Whittier, Calif., where it also operates a major hardgoods distribution center and Airgas Safety telesales center. Lawson intends to relocate the Rutland Tool Whittier operations in the coming year. The six other Rutland operations in Chatsworth, Santa Ana and San Jose, Calif.; Phoenix; Houston; and Suwanee, Ga., will be transferred with the business.

Lawson Products, based in Des Plaines, Ill., is a leader in selling and distributing services, products and systems to the MRO (maintenance, repair and operations) and OEM (original equipment manufacturing) marketplaces.