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Schneider buys APC for $6.1 billion

French electrical equipment manufacturer Schneider Electric has acquired uninterruptible power supply (ups) firm American Power Conversion (APC) for a reported US$6.1 billion (AED22.4 billion).

French electrical equipment manufacturer Schneider Electric has acquired uninterruptible power supply (ups) firm American Power Conversion (APC) for a reported US$6.1 billion (AED22.4 billion).

The move will make Schneider one of the largest ups suppliers in the world, the firm already owning the MGE UPS brand. It is also expected to see the firm expand its production in the US and Asian markets.

Schneider was one of three firms to approach APC following the announcement of its chief executive officer Roger Dowdell’s retirement.

After a bidding process involving Schneider and two unnamed companies, an agreement was reached with APC on a share price of $31. The deal is subject to approval from APC shareholders and the all-cash deal is expected to be completed in the first quarter of 2007.

Schneider chief executive officer Jean-Pascal Tricoire described the transaction as “a significant strategic move and a tremendous opportunity for growth for both companies”.

APC has been a leading global player in the power solutions market for over 25 years and is Nasdaq-listed. In 2006 its sales were valued at $2 billion, the bulk of which were in the small ups market where it held an estimated 74% of market share.

The APC brand also holds around 22% market share for large ups systems, with sales of around $400 million.
Schneider and APC expect to cut operating costs by combining r&d, sales and service businesses.

It is estimated that the merger will produce savings of around $220 million, 70% of which will be achieved by 2009.
Schneider has also committed to maintaining the APC name and branding.

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