Air Products says FTC signs off on Airgas bid

* Tender offer extended to October 29

* Air Products says signs consent decree with FTC for deal

* Airgas says news 'does nothing to change our conviction'

* Issue likely settled at Airgas meeting in September

(Adds Airgas response, byline)

By Ernest Scheyder

NEW YORK, (Reuters) - Air Products and Chemicals Inc said Monday it has signed a consent degree with the U.S. Federal Trade Commission that would let it acquire Airgas Inc, and the industrial gas supplier extended its tender offer for the proposed deal.

Air Products had sought the approval for some time, and the extension was widely expected. Attention now turns to Airgas's annual meeting, which will be held next month.

Allentown, Pennsylvania-based Air Products said it has signed a consent decree with the FTC which lets it complete the acquisition if and when it receives support from a majority of Airgas shareholders and begins to divest certain assets.

Airgas said the tender extension and the FTC agreement "does nothing to change our conviction that the Air Products' offer grossly undervalues Airgas."

"We ... encourage all Airgas stockholders not to tender their shares into Air Products' grossly inadequate offer, and similarly encourage those who have tendered to withdraw their shares," the Radnor, Pennsylvania-based company said in a statement.

As of Aug. 13, Air Products said it had received about 23 percent of Airgas' stock as a result of its offer. Air Products said that total includes shares of Airgas it already owns.

Air Products pushed the deadline for Airgas shareholders to tender into its offer to Oct. 29. The previous deadline had been Aug. 13.

Air Products had boosted its offer in early July to $63.50 per share from $60 per share.

"The Airgas board has refused to discuss our offer and has also failed to promptly put the company up for sale," Air Products Chief Executive John McGlade said in a statement. "There remain no substantive impediments to closing immediately other than the intransigence of the Airgas board."

Both companies posted better-than-expected quarterly profit last month.

Shares of Airgas rose 0.8 percent to $65.44 in morning trading, while shares of Air Products rose 0.5 percent to $76.07. (Reporting by Ernest Scheyder, editing by Gerald E. McCormick)