Emerson Electric (NYSE: EMR) boosted its offer to buy Rockwell Automation (NYSE: ROK) to about $29 billion, after the smaller rival rebuffed a $27.6-billion bid last month saying it undervalued the company.
Emerson's latest offer is for $225 per share, comprising $135 per share in cash and $90 per share in Emerson stock.
Milwaukee, Wisconsin-based Rockwell had rejected a $215 per share bid from Emerson in October, split in half between cash and shares. In November, Rockwell defended its strategy to operate as a standalone company.
St. Louis, Missouri-based Emerson said on Thursday it estimates about $6 billion of savings from a potential deal, equating to an additional $10 per share in value for Rockwell shareholders.
"We remain convinced there is compelling strategic, operational, and financial merit to bringing together our two companies," Emerson Chief Executive David Farr said in a statement.
Farr went on to say, "A combination of Emerson and Rockwell would create a leader in the $200-billion global automation market. Together, we could offer an unmatched technology portfolio that addresses customers’ current and future needs for a fully connected enterprise, where process, discrete, and hybrid work seamlessly together rather than relying on single, disparate platforms."
Emerson's strength is in process automation, helping power plants and factories in sectors such as mining and cement operate more efficiently.
Rockwell is a leader in so-called discrete automation, helping assemble component parts to manufacture items such as automobiles, household appliances, and computer systems.
Shares in Emerson gained 18 cents Thursday afternoon to $59.29, while Rockwell shares rocketed $5.27, or 2.8%, to $194.00
