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Eaton to buy Cooper Industries to expand reach in global electrical industry

Cleveland, OH -- Eaton Corp. has agreed to purchase Cooper Industries PLC, Maynooth, Ireland, in a cash-and-stock deal valued at about US$11.46 billion that is designed to expand its reach in the global electrical power and distribution...


Cleveland, OH — Eaton Corp. has agreed to purchase Cooper Industries PLC, Maynooth, Ireland, in a cash-and-stock deal valued at about US$11.46 billion that is designed to expand its reach in the global electrical power and distribution industry.

Cooper offers a variety of electrical products including electrical protection, power transmission and distribution, lighting and wiring components. Eaton, which is based in Cleveland, makes electrical and hydraulic components, systems and services. It also makes aerospace fueling, hydraulic and pneumatic systems for commercial and military use as well as vehicle drivetrain and powertrain systems.

The deal would create a company that manufactures products for a wide range of electrical uses, from power grids and lighting to electrical, hydraulic and transmission systems for vehicles, the aerospace industry and the military.

The new company, likely to be called Eaton Global Corp. PLC, will be incorporated in Ireland and headed by Eaton chairman and CEO Alexander Cutler. The deal needs the approval of shareholders of both companies and the Irish High Court. It is expected to close in the second half of 2012.

Cutler told analysts during a conference call that the combination of the two companies will create a business well-positioned for growth in managing power for customers around the world.

The companies expect to achieve $375 million of operational synergies — a term that refers to estimated cost savings and added revenue resulting from the combination.

Eaton spokesman Gary Klasen said they would not be able to discuss any impact on jobs until the transaction closed and officials had a chance to evaluate the new company’s needs. He said operations in Cleveland would remain intact.

The deal needs the approval of a majority of Cooper shareholders and of the Irish High Court. Eaton shareholders with two-thirds of the company’s outstanding voting stock also must also approve the buyout.