U.S. conglomerate General Electric has agreed to buy British maker of oilfield services equipment Sondex for 288.7 million pounds ($583.1 million) in cash, the two companies said on Monday.
General Electric , whose interests span technology, media, energy and financial services, will pay 460 pence a share for Sondex , which designs, makes and markets electro-mechanical based equipment for oilfield service companies.
That is 35.5% above Sondex's closing share price on Aug. 30, the day before it announced it was in takeover talks. Sondex shares were up 7.5% at 454.25 pence by 0752 GMT.
Sondex Finance Director Chris Wilks told Reuters that he and Chief Executive Martin Perry would be staying with the company, and would urge GE to make additional acquisitions.
"GE buys 100 companies a year -- it's pretty acquisitive -- and we want to convince them to spend more money in our space," he said in a telephone interview.
He added that the company would also look to expand its presence in China, where it has around 10 staff but GE has far more. "We can use GE's resources world-wide to tackle market penetration," he said.
GE is buying Sondex through its U.S.-based Optimization and Control business -- an oilfield-services specialist -- which generates turnover of about $1.1 billion.
A spokesman for GE in Europe said this was the division's first venture outside the United States, but would not comment on whether it was a one-off or the start of an acquisition run.
GE said it had irrevocable undertakings and non-binding letters of intent in favour of the bid from 44.2% of shareholders, and Chris Wilks said he would be surprised if another bid came in.
He said the group had originally received two separate approaches -- including the one from GE -- and had sounded out other potential buyers before agreeing the 460 pence deal.
"Of the small group we approached, GE was the highest -- not by a massive margin but still the highest. Will another party that we didn't approach come forward? You never say never but I would be surprised," he said.
Sondex's share price has risen to the offer level of 460 pence from a flotation price of just 100 pence in 2003 -- but Wilks denied the company was unjustly blocking shareholders from the next phase of growth.
"Yes, we could have continued that level of growth into the future but with growth like that there is risk. This is a discount to that risk," he said.
GE's Optimization and Control unit is part of GE Energy, which contributed around $12 billion of the $163.4 billion sales generated by the group in total last year.