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FinanceSwiss ABB to acquire UK engineering group Rotork in £4.1bn deal
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Rotork, a UK-based FTSE 250 engineering firm, has agreed to a £4.1bn takeover by Swiss rival ABB. The deal values Rotork at 506p per share in cash, a 73% premium over its closing price on 15 July. Rotork's board unanimously recommended the offer to shareholders. ABB CEO Morten Wierod cited a compelling strategic fit, and Rotork will operate as a separate division within ABB's automation business, expected to add 3% to ABB's total revenue. The acquisition is part of a broader trend of foreign buyers targeting London-listed companies, with 29 proposed takeovers over £100m this year. The article also notes subdued IPO activity and criticism from Shadow Business Secretary Andrew Griffith regarding London's capital market challenges.
Source report
Rotork is set to become the latest company snapped off the London Stock Exchange by a foreign buyer, after agreeing to a £4.1bn takeover by Swiss rival ABB.
Deal Details
The engineering group agreed to pay 506p per share in cash for the FTSE 250 firm, comprising:
- 503p in cash
- A dividend of up to 3p
The offer price represents a 73 per cent premium over Rotork’s closing share price on 15 July.
Rotork’s board unanimously agreed to recommend the offer to shareholders.
Strategic Rationale
ABB’s chief executive, Morten Wierod, said: “We are convinced of the compelling strategic fit of the transaction.”
Rotork will operate as a separate division within ABB’s automation business and is anticipated to add three per cent to the Zurich-based group’s total revenue.
ABB, one of Europe’s largest industrial engineering groups with over 100,000 employees, said the acquisition would bolster and expand its automation division.
Market Performance
Rotork’s shares are down 10.6 per cent since January.
Broader Market Context
The deal marks yet another London-listed company being acquired by a foreign buyer. According to Peel Hunt, the market has now seen 29 proposed takeovers of UK companies worth more than £100m, while IPO activity remains subdued.
In the first half of the year:
- Only seven listings took place
- These raised £577.2m
- The total market value of new listings reached just £2.2bn
Larger firms have also fallen into the sights of foreign buyers this year, including FTSE 100 insurer Beazley, which was taken over in an £8bn deal by Zurich.
Political Reaction
Shadow business secretary Andrew Griffith criticised “ivory tower financial regulators” last week for failing to address problems facing London’s capital markets. Writing on social media platform X, he said: “It’s a scandal and the damage they have done to the City has been tolerated for far too long.”
Source
City AMWestern
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Engineering group Rotork acquired by Swiss ABB in £4.1bn deal