Pentair, which specializes in filter and pump manufacturing, will buy Tyco's flow control business for $4.6 billion in an all-stock deal. Tyco's flow business sells valves and thermal controls.
Pentair Inc. Price History
The news shot PNR stock up 19% to $47.85 in early morning trading.
Pentair is already poised to profit from the world's growing need for clean water, as we detailed Tuesday. Investors who bought in to Pentair at Tuesday's closing price could have netted a double-digit gain today.
Now Pentair's merger with Tyco will give it an even bigger market share in the growing water solutions industry. Pentair will expand its product offering to include pipes, valves, and control products, and increase its industrial exposure and global reach.
"The new Pentair will be well positioned to benefit from the increased demands on energy, water, infrastructure and industrial process resulting from the growing population and wealth of developing economies," Pentair CEO Randall Hogan said Wednesday in a conference call. "The combined company will have increased scale, broader geographic reach and greater access to high-growth attractive sectors."