Invensys plc Agrees To 502p Per Share Offer

Invensys plc (LON: ISYS) recommends a cash and share offer from Schneider Electric.

Maynard Paton

Maynard has worked at the Fool since 1999. He ran the Qualiport online portfolio on the Fool from November 1999 to September 2005 and was lead adviser for the Champion Shares & Champion Shares PRO stock-picking services from September 2005 to June 2011, at which point he moved to become Deputy Editor of the UK Fool. Prior to joining the Fool, Maynard worked for a year as a Poll Tax clerk and then for six years at the local authority's IT department in the murky world of ICL mainframes and COBOL programming. He relocated to Kent to join a financial services firm's IT department and there discovered the joys of stock market investing. As well as keeping an eye on share prices and his local housing market, Maynard's interests include karting, martial arts and entertaining his young family.

Published 31 July, 2013 8:37 am BST

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

The shares of Invensys (LSE: ISYS) gained 9p to 500p during early trade this morning after the industrial controls and software specialist agreed to a 502p per share offer from Schneider Electric.

Invensys confirmed shareholders would receive 372p per share in cash and 0.025955 shares in the French conglomerate, whose shares currently trade at €58.

The FTSE 250 mid-cap also said shareholders would still receive the 3.57p per share final dividend declared in May.

Schneider claimed the £3.4bn transaction would generate “significant revenue synergies” of approximately €400m per annum by 2018 as a result of “enlarged offerings, complementary customer bases and additional scale“.

The group also reckoned it would achieve cost savings of approximately €140m per annum by 2016 through “structural and administrative cost savings, efficiency gains… and synergies on procurement and production costs.“

Commenting on the deal, Sir Nigel Rudd, the chairman of Invensys, said:

“The Invensys directors believe that the offer from Schneider Electric represents an attractive value for Invensys shareholders and reflects the future growth prospects of the business.“

Mr Jean-Pascal Tricoire, the chief executive of Schneider Electric, added:

“We believe our offer is compelling to Invensys Shareholders who will realise significant value for their holdings while having the opportunity to participate in the future strengths of the combined business.”

Today’s takeover agreement marks the end of a good run for the shares of Invensys, which have rallied from 331p since the start of the year and from 143p since the depths of the banking crash.

So, if you currently own Invensys shares and are now looking for a new home for your forthcoming cash from Schneider Electric, the Fool’s top analysts have named one company they believe will bring you superior long-term capital growth…

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> Maynard does not own any share mentioned in this article.