Schneider offer fuels talk of $5 billion Invensys bid battle

Fri Jul 12, 2013 11:08am EDT
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By Paul Sandle and James Regan

LONDON/PARIS (Reuters) - The prospect of a bid battle powered Invensys ISYS.L shares to a ten-year high on Friday, after the British engineer said it had received a 3.3 billion pound ($5 billion) takeover proposal from France's Schneider Electric (SCHN.PA: Quote).

Invensys said Schneider, which confirmed only that it had made a proposal, was considering an offer of 505 pence a share in cash and stock, 15 percent above Invensys' closing price on Thursday.

A deal would allow Schneider to tap the British firm's strength in industrial automation, which is enjoying rapid growth in the oil, gas, petrochemicals and utilities sectors.

However, Invensys shares jumped as high as 513.5 pence on speculation the proposal could flush out other bidders.

U.S. group Emerson Electric (EMR.N: Quote) was in talks to buy Invensys a year ago, while a report in May 2012 said Germany's Siemens (SIEGn.DE: Quote), Switzerland's ABB ABBN.VX and U.S. giant General Electric (GE.N: Quote) had also made informal contact.

Those companies either declined to comment, or could not immediately be reached for comment.

"The most obvious candidate is Emerson, which was in related talks with Invensys back in June 2012," Societe Generale analysts said.

If a bid battle for Invensys breaks out, the share price could go even higher, said Neil Veitch, a fund manager at SVM Asset Management, which holds Invensys stock.   Continued...