Rockwell Automation receives second takeover bid from Emerson
Having rejected a $27.6bn takeover bid from Emerson, Rockwell Automation is once again considering a multi-billion-dollar takeover bid with its industry rival having upped its offer to $29bn.
“We remain convinced there is compelling strategic, operational, and financial merit to bringing together our two companies – and that such a combination would benefit our respective customers, employees and shareholders,” said David Farr, CEO of Emerson.
“The industrial logic for this combination is clear. A combination of Emerson and Rockwell would create a leader in the $200 billion global automation market.”
Rockwell previously rejected Emerson’s initial acquisition some two weeks back, reasoning that the offer undervalued the company. However, the new $29bn represents a 30% premium compared to Rockwell’s share price prior to any knowledge of Emerson’s proposed acquisition being revealed.
Further, despite Rockwell’s shares being up 7%, trading at $202 before the offer was made, this still remained well below the new offer price that would see Emerson purchasing the entirety of Rockwell’s shares at a price of $225 per share.
The proposal stands as a part-cash, part-share transaction, with shareholders expected to receive $135 in cash and $90 in Emerson shares per Rockwell share, should the offer be accepted.