Shares of British engineering company Rotork surged 67% on Thursday after Swiss industrial giant ABB agreed to acquire the company for $5.5 billion in the largest acquisition in ABB’s history, extending a wave of foreign takeovers that is reshaping the UK stock market.
The recommended cash offer eclipses ABB’s previous biggest acquisitions, including its $4.2 billion purchase of Baldor in 2011 and its $3.9 billion acquisition of Thomas & Betts a year later.
The deal was announced alongside ABB’s second-quarter earnings, which exceeded analyst expectations and underscored strong demand for automation products linked to artificial intelligence infrastructure.
ABB strengthens its automation business
Rotork manufactures actuators and flow control equipment that automate the opening and closing of industrial valves used to regulate liquids and gases.
Its products are widely used across industries including oil and gas, power generation, water treatment, chemicals, mining, and marine operations.
The company generated roughly $1 billion in revenue in 2025 and has been expanding at an annual rate of about 8%.
ABB expects the acquisition to add around 3% to group revenue while immediately enhancing profitability, with Rotork reporting an operating margin of 24.6%.
“ABB has followed Rotork over many years,” chief executive Morten Wierod said.
“We are convinced of the compelling strategic fit of the transaction that will expand our automation offering at the field device layer.”
The acquisition will be financed using proceeds from ABB’s planned $4.8 billion sale of its robotics division to SoftBank Group, announced last October.
UK takeover activity gathers pace
The transaction adds to a growing list of UK-listed companies agreeing to overseas takeover offers, putting Britain on course for its busiest year ever for mergers and acquisitions.
ABB’s move follows recent bids for Intertek, Schroders, Unilever’s food business, and Tate & Lyle, which received an offer from US-listed Ingredion in June.
Separately, energy services company DCC said on Thursday it had received an improved proposal from investment firms KKR and Energy Capital Partners.
The consortium increased the value of its previous £5.7 billion offer by adding up to 125 pence per share in cash, funded through proceeds from the planned sale of DCC’s technology business, Nexora.
The bidders have until July 27 to either submit a firm offer or walk away.
Earlier this month, Reuters reported that takeover offers for UK companies have exceeded $231 billion so far this year, more than triple the level seen at the same stage in 2025.
Foreign buyers account for 86% of the total value of UK mergers and acquisitions in 2026, up from 75% a year earlier, with US companies responsible for more than half of overseas bids.
The sustained pace of acquisitions has continued to reduce the number of companies listed on the London Stock Exchange as international buyers seek to capitalise on comparatively lower UK valuations.
Strong earnings support acquisition
ABB’s takeover announcement came as the engineering group reported stronger-than-expected second-quarter earnings.
Operational earnings before interest, tax, and amortisation rose 20% year over year to $1.93 billion for the three months ended June, ahead of analyst expectations of $1.88 billion.
Revenue increased 14% to $9.48 billion, broadly matching forecasts, while net income rose 7% to $1.23 billion.
Orders climbed 30% to $12.04 billion as customers continued investing in electrification and automation equipment, particularly for data centres supporting AI workloads.
“Our second-quarter results reflect high demand in the majority of our customer segments,” Wierod said.
ABB’s shares rose about 3% in premarket trading in Zurich following the earnings release and the announcement of the Rotork acquisition.
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