ABB sets up £860 million bidding battle for UK’s Chloride with Emerson Electric

Swiss ower and automation technology group ABB today said it was acquiring the UK-based Chloride, a provider of uninterruptible power supply equipment, for £860 million (approximately Rs5,863 / $1.3 billion), setting up a potential bidding war with US-based Emerson Electric Co.

ABB's offer of 325 pence per Chloride share, representing a premium of 55.5 per cent, based on Chloride's closing price of 209 pence on 23 April 2010, has been accepted by the board of the London-based Chloride.

Chloride, which is the largest supplier of uninterruptible power supply equipment in the UK, had in April rejected its larger transatlantic rival Emerson's 275 pence a share offer, valuing it at £723 million, which Chloride rejected as it undervalued the company. (See: UK's Chloride Group turns down £723 million merger offer from Emerson Electric) 

In its earlier 2008 bid, Emerson had offered 270 pence per share, but talks broke down after the development became public. The offer, although on the lower side in pound sterling terms, valued the company at about $1.3 billion in dollar terms at the time due to exchange rate fluctuations.

Ferguson, Missouri-based Emerson said in a statement today that it was considering its position and would make an announcement in due course.

Chloride, which had sales of  326.7 million in 2009, is a leader in uninterruptible power supply (UPS) systems with solutions for a wide range of applications, including data centres and energy and infrastructure applications.