Emerson closes on Chloride as Swiss rival refuses to up takeover offer

A BREAKTHROUGH in a £1 billion takeover battle brought another famous name from the UK's industrial past closer to American ownership yesterday.

Emerson Electric's two-year pursuit of Chloride appeared near to success after its bid rival, engineering firm ABB, decided not to increase its offer. Chloride, which provides blue-chip companies with systems to protect against power outages, was a well-known battery manufacturer but has been a secure power solutions firm since 2000.

It employs some 2,300 people in 15 countries, of which 374 are located in the UK.

It rebuffed Emerson in May 2008, but the Missouri-based firm returned with another approach worth 723 million in April this year. This was also rejected by the Chloride board, which later accepted an offer worth 864m from Zurich-based engineering firm ABB.

However, Emerson returned this week with what now appears to be a knock-out bid valuing the company at 997m.

Chloride said ABB's decision not to raise its offer meant it would enter into discussions with Emerson Electric. Unlike ABB, Emerson is already a major player in the market for uninterruptible power supply (UPS) systems.

The US firm, which employs 130,000 people, expects that Chloride will form the basis of its European UPS growth strategy, although it said this week that its higher price meant it could no longer be certain that a combination will result in a net addition of skilled jobs in the UK. Emerson boss David Farr said this week: "The geographic reach and offerings of Emerson and Chloride are highly complementary."

Chloride was established more than 100 years ago and enjoyed a lengthy period as a successful battery manufacturer.