The French energy management specialist Schneider Electric has agreed to buy British engineering firm Invensys for £3.4bn.
The takeover has been hailed in the national press as another nail in the coffin of British-owned industrial power.
However, although the company employs around 1,100 people in the UK at locations in Worthing and Crawley, West Sussex, Sir Nigel Rudd, Invensys chairman, said: “Basically this is an American company – 95 per cent of the sales are outside the UK: all of the product development is in the US. This is not a UK company.”
Other financial commentators said that to view the sale of this major global entity as a national concern would be ‘parochial’.
Invensys had already divested some of its assets into foreign hands in recent years to help offset mounting net debt. This included the sale of its £1.7bn rail division to the German industrial firm Siemens in 2012.
The company had slipped out of the FTSE 100 in 2011.
If the buyout goes ahead – it is yet to be approved by shareholders – the resulting company will employ around 156,000 people worldwide, though this is likely to be swiftly reduced according to Schneider’s chief executive Jean-Pascal Tricoire. The CEO said there would be a need to find cost savings of EU140m a year.
Schneider Electric’s primary interest in Invensys is its software development and engineering capabilities which it feels will complement its business.
It hopes the new capability will allow it gain more ground in the high margin industrial-automation market for energy management. In June Schneider Electric unveiled what it said was a ‘groundbreaking’ energy management system called StruxureWare for the UK market.