Rotork to Join ABB Automation as Separate Division Under Proposed $5.5 Billion Transaction

Rotork to Join ABB Automation as Separate Division Under Proposed $5.5 Billion Transaction

(IN BRIEF) ABB has agreed terms for a recommended all-cash offer to acquire Rotork plc, valuing the flow control and electric actuator specialist at an enterprise value of around $5.5 billion. The offer is set at 503 pence per Rotork share, representing a premium of around 60% to Rotork’s latest three-month average share price. ABB said the transaction will strengthen its Automation business by expanding its field-device layer capabilities with Rotork’s mission-critical flow control, instrumentation and intelligent actuator solutions. Rotork is expected to operate as a separate division within ABB’s Automation business area after closing. Rotork generated around $1 billion in 2025 revenues and an adjusted operating profit margin of 24.6%. ABB expects Rotork to add around 3% to group revenues and around 12% to Automation business area revenues, with immediate accretion to Operational EBITA margin. The transaction is expected to close in the first half of 2027, subject to shareholder and regulatory approvals.

(PRESS RELEASE) ZURICH, 16-Jul-2026 — /EuropaWire/ — ABB has announced that it has agreed terms with Rotork plc on a recommended all-cash offer for the entire issued and to be issued share capital of Rotork, a global provider of mission-critical intelligent flow control solutions and a leading independent manufacturer of electric actuators.

The proposed acquisition is aligned with ABB’s strategic focus on electrification and automation and is expected to expand the offering of ABB’s Automation business area for large-scale and complex infrastructure and industrial applications.

Under the terms of the offer, Rotork shareholders would receive 503 pence in cash per Rotork share, representing a premium of approximately 60% to Rotork’s latest three-month average share price. The transaction implies an enterprise value of around $5.5 billion.

The valuation reflects an EV/Sales multiple of approximately 5.3 times based on 2025 actual figures and an EV/EBITDA multiple of around 19.5 times, also based on 2025 actual figures. ABB said the EV/EBITDA multiple is expected to reduce towards the mid-teens level when anticipated synergies are taken into account.

Rotork shareholders will also be entitled to receive an interim dividend of up to 3 pence per Rotork share for the period to 30 June 2026, without any reduction to the offer value.

ABB said Rotork’s strong position in mission-critical flow control and instrumentation is highly complementary to its existing automation portfolio and would strengthen ABB’s presence at the field-device layer.

The combination would expand ABB’s automation capabilities by enhancing the “sense-control-act” automation loop with intelligent field devices and software designed to monitor and manage industrial processes continuously. ABB said this would support safer, more productive and more sustainable operations.

The transaction is also expected to improve the mix of ABB’s Automation business through greater exposure to higher-margin products, services and lifecycle revenues.

Rotork is expected to benefit from ABB’s global scale, market reach, service presence, digital capabilities and technology platforms. ABB said these strengths would help accelerate Rotork’s growth in core and target segments, while creating further opportunities to expand its installed-base service model and lifecycle offering.

The proposed combination would also support the development of intelligent device diagnostics and asset management solutions using ABB’s digital platforms. In addition, Rotork would be able to draw on ABB’s customer relationships and earlier project engagement to pursue larger and more strategic projects, while expanding into new customers, applications and geographies.

Following completion, Rotork is expected to operate as a separate division within ABB’s Automation business area under a strategic growth mandate. ABB said this structure is consistent with the ABB Way decentralised operating model, which emphasises accountability, transparency and fast decision-making close to customers.

Rotork recorded average annual organic revenue growth of 8% between 2022 and 2025, serving sectors including oil and gas, chemicals, process and industrial markets, data centres, water and power.

With 2025 revenues of around $1 billion and an adjusted operating profit margin of 24.6%, Rotork is expected to add approximately 3% to ABB’s revenues and be immediately accretive to ABB’s Operational EBITA margin.

Within ABB’s Automation business area, Rotork is expected to add around 12% to revenues and be immediately accretive to the business area’s Operational EBITA margin, supporting ABB’s growth ambitions.

Morten Wierod, Chief Executive Officer of ABB, said ABB has followed Rotork for many years and has strong regard for its execution, engineering quality and customer trust.

“ABB has followed Rotork over many years, and we admire the execution excellence, engineering quality, and customer trust that Rotork’s teams deliver each day,” said Wierod.

He added that ABB sees a compelling strategic fit in the transaction, which would expand its automation offering at the field-device layer and generate significant value for customers, employees and shareholders of both companies.

Wierod said that, as part of ABB, Rotork is expected to accelerate growth and value creation while retaining the entrepreneurial spirit and customer proximity that have contributed to its success. He also noted that ABB’s strong balance sheet provides room for additional mergers and acquisitions as well as execution of its announced share buyback programme.

Dorothy Thompson, Chair of Rotork, said the Rotork board believes the offer reflects the quality of the company and recognises the progress achieved through its Growth+ strategy.

She said the offer provides Rotork shareholders with an attractive opportunity to accelerate the value creation of the company’s future prospects in cash at closing.

Thompson added that the combination brings together two companies with closely aligned purposes and a shared focus on automation and electrification to support more sustainable and efficient operations.

She also said ABB’s decentralised operating model and commitment to run Rotork as a separate division are expected to benefit Rotork’s business, employees and wider stakeholders. The Rotork board has unanimously agreed to recommend the offer to shareholders.

ABB said the UK remains an important market for the company, where it has more than 1,700 employees. The company also recognised Rotork’s role as a UK engineering employer and contributor to the country’s industrial base.

ABB said it intends to support continuity of leadership and work closely with Rotork’s management team following completion to enable a smooth integration. The company has no current plans to significantly change Rotork’s presence in the UK, which is expected to remain an important manufacturing and technology base for the business.

The offer will be financed through ABB’s existing cash resources and committed bank facilities. As of 30 June 2026, ABB held approximately $5.8 billion in cash and marketable securities.

ABB also noted that the signed divestment of its Robotics business to SoftBank is expected to generate approximately $4.8 billion in net cash proceeds at closing, targeted for the second half of 2026, further strengthening ABB’s liquidity.

The transaction will be implemented through a court-sanctioned scheme of arrangement under the UK Companies Act 2006. Rotork’s board of directors has unanimously approved the transaction and intends to recommend that shareholders vote in favour at the upcoming shareholder meeting.

The transaction is expected to close in the first half of 2027, subject to Rotork shareholder approval and customary regulatory clearances.

Barclays acted as sole financial adviser to ABB, while Freshfields acted as legal adviser.

ABB is a global technology leader in electrification and automation, enabling a more sustainable and resource-efficient future. By connecting its engineering and digitalization expertise, ABB helps industries run at high performance, while becoming more efficient, productive and sustainable so they outperform. At ABB, we call this ‘Engineered to Outrun’. The company has over 140 years of history and around 110,000 employees worldwide. ABB’s shares are listed on the SIX Swiss Exchange (ABBN) and Nasdaq Stockholm (ABB). www.abb.com

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SOURCE: ABB