Emerson Boosts Offer for Rockwell Automation to $29 Billion

Emerson Electric Chairman and CEO David Farr can’t seem to get Rockwell Automation off his mind. Emerson renewed its bid for the Milwaukee-based factory automation powerhouse this week after Rockwell previously declined two earlier offers. Rockwell said it is reviewing the new proposal, which boosts the total offered to Rockwell shareholders to around $29 billion.

Farr’s fancy for Rockwell is well justified as the addition of one of the dominant names in the U.S. factory automation market would fit nicely with Emerson’s existing automation and control offering focused on process industries such as oil refining, petrochemical, pharmaceuticals and beverages.

The new bid offers Rockwell shareholders $225 per share —$135 per share in cash and $90 per share in Emerson stock — up from previous offers of $200 and $220, the most recent of which Rockwell declined late last month.

In a letter to Rockwell Chairman and CEO Blake Moret that was released by Emerson, Farr said a combination of the two companies “would have increased scale across key end markets, with approximately $23 billion in annual revenue, supporting increased investments in software and technology and an acceleration of both top-line and bottom-line growth.”

“The industrial logic for this combination is clear,” Farr also said to Moret. “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. By leveraging the key technology platforms that are the strengths of Emerson and Rockwell, we can create an industry leader with unmatched capabilities that integrates all aspects of the automation system for a global customer base. Competitors are already moving to provide integrated solutions. The combination of Emerson and Rockwell would accelerate our combined growth and position us for success for many years to come.”