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<\/p>\nThe cash offer values Rotork at about $5.5 billion and is expected to close in the first half of 2027.<\/p>\n
ABB Ltd announces that it has agreed with Rotork plc, a well-established global provider of mission-critical intelligent flow control solutions and a leading independent manufacturer of electric actuators, the terms of a recommended cash offer for the entire issued and to be issued share capital of Rotork. The transaction is expected to further strengthen ABB\u2019s focus on electrification and automation and expand its Automation business area\u2019s offering for large and complex infrastructure and industries.<\/p>\n
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Under the terms of the offer, each Rotork shareholder would be entitled to receive 503 pence in cash per Rotork share, representing a premium of around 60% to Rotork\u2019s latest 3-month average share price. The transaction implies an enterprise value of around $5.5 billion, reflecting an EV\/Sales (2025 actual) multiple of around 5.3 as well as an EV\/EBITDA (2025 actual) multiple of around 19.5x with the latter reducing towards the\u00a0\u2018mid teens\u2019\u00a0level when accounting for anticipated synergies.<\/p>\n
Rotork shareholders will also be entitled to receive an interim dividend for the period to June 30, 2026 of up to 3 pence per Rotork share (the \u201cPermitted Dividend\u201d) without any reduction to the offer value.<\/p>\n
Compelling strategic fit<\/p>\n
Rotork\u2019s business with well-established positions in mission-critical flow control and instrumentation is highly complementary to ABB\u2019s existing automation portfolio and will strengthen ABB\u2019s position at the field-device layer. ABB would benefit from an expanded automation offering, enhancing the \u201csense-control-act\u201d automation loop with intelligent field devices and software that continuously monitors and manages industrial processes for safer, more productive, and sustainable operations. The mix of ABB\u2019s Automation business would be improved through increased exposure to higher-margin products, services, and lifecycle revenues.<\/p>\n
Through this proposed combination, Rotork would be able to benefit from ABB\u2019s global scale, market reach, service presence, and digital and technology capabilities. This will facilitate accelerated growth in core and target segments with a further opportunity to expand the installed-base service model bringing additional lifecycle opportunities. The combination will allow Rotork to accelerate the development of intelligent device diagnostics and asset management solutions with ABB\u2019s digital platforms. Additionally, Rotork would be able to leverage ABB\u2019s trusted customer relationships and earlier project engagement to support participation in larger and more strategic projects, thereby accelerating penetration of new customers, applications, and geographies.<\/p>\n
Upon closing Rotork is expected to operate as a separate division under a strategic growth mandate within ABB\u2019s Automation business area. This approach is in line with the ABB Way decentralized operating model that emphasizes accountability, transparency, and speed in decision-making and execution, built on the principle that operating decisions are best made within the divisions and close to customers.<\/p>\n
Rotork recorded 8% average annual organic revenue growth in 2022 to 2025 serving segments including oil & gas, chemical, process and industrial, including data centers, as well as water and power. With 2025 revenues of around $1 billion and 2025 adjusted operating profit margin of 24.6%, Rotork is expected to add around 3% in revenues to ABB and be immediately accretive to ABB\u2019s Operational EBITA margin. As part of ABB\u2019s Automation business area, Rotork is also expected to add around 12% to the business area\u2019s revenues, supporting its growth ambitions, and be immediately accretive to the business area\u2019s Operational EBITA margin.<\/p>\n
Commitment to Rotork\u2019s UK footprint<\/p>\n
The UK is an important market for ABB, with over 1,700 employees. ABB recognizes Rotork\u2019s role as a UK engineering employer and contributor to the UK\u2019s industrial base. Its intention is to support continuity of leadership and to work closely with Rotork\u2019s management team following completion, enabling a seamless integration. ABB has no current plans to significantly change Rotork\u2019s presence in the UK which is expected to remain an important manufacturing and technology base for Rotork.<\/p>\n
Financing of the offer<\/p>\n
ABB\u2019s capital allocation framework includes pursuing value-accretive acquisitions, and the company will finance the transaction through existing cash resources (approximately $5.8 billion cash and marketable securities as of June 30, 2026) as well as committed bank facilities. In addition, the signed divestment of ABB\u2019s Robotics business to SoftBank is expected to deliver approximately $4.8 billion of net cash proceeds at closing targeted for the second half of 2026, further strengthening ABB\u2019s liquidity.<\/p>\n
Timing and approvals<\/p>\n
The transaction will be implemented by way of a court-sanctioned scheme of arrangement under the U.K. Companies Act 2006. Rotork\u2019s board of directors has unanimously approved the transaction and intends to recommend to its shareholders to vote in favor of the transaction at its upcoming shareholders meeting.<\/p>\n
The transaction is expected to close in the first half of 2027 and is subject to Rotork\u2019s shareholder vote and customary regulatory approvals.<\/p>\n
Barclays acted as sole financial advisor and Freshfields as legal advisor to ABB.<\/p>\n
The full terms and conditions of the acquisition are set out in ABB\u2019s announcement of a firm intention to make an offer for Rotork in accordance with Rule 2.7 of the Takeover Code (the \u201cRule 2.7 Announcement\u201d), available at\u00a0https:\/\/new.abb.com\/rotorkoffer<\/a><\/p>\n