Ingersoll Rand says rival SPX Flow snubs sweetened $3.59 bln buyout bid
July 19 (Reuters) - Ingersoll Rand said on Monday smaller rival SPX Flow rejected its sweetened $3.59 billion takeover offer that the U.S. industrial equipment maker had proposed to strengthen its foothold in the food and beverage industry.
Shares of SPX, which makes components for machinery used by food-and-beverage and industrial companies, surged as much as 30% to a record high of $80.62 following the news. Ingersoll's shares were down 4% amid a broader marker decline.
A deal with SPX Flow would substantially expand Ingersoll's presence in the food and beverage industry, Barclays analysts said in a note, adding there was scope for significant cost savings from the merger.
SPX Flow garnered 47% of its 2019 sales from the food and beverage market, while one of Ingersoll's units recorded 5% of its revenue from the segment.
"While we had hoped to complete a transaction privately, we remain committed to engaging with SPX Flow on a friendly basis and in a constructive and collaborative manner," Ingersoll Rand Chief Executive Officer Vicente Reynal said in a statement, confirming SPX's refusal.
SPX Flow was not immediately available for comment.
Reuters on Sunday reported citing sources that SPX Flow had rebuffed takeover approaches from Ingersoll Rand.
Ingersoll first offered to buy SPX Flow in May for $81.50 per share, before sweetening the offer in June to $85 per share, which represents a premium of about 37% to SPX Flow's closing price on Friday.
SPX Flow rejected both offers and declined to "engage in constructive dialogue", Ingersoll said. (Reporting by Ankit Ajmera in Bengaluru; Editing by Shinjini Ganguli)
