The London takeover wave intensified on Thursday as Swiss engineering giant ABB agreed to buy Bath-based flow-control specialist Rotork for £4.1bn, the latest in a string of foreign acquisitions hollowing out the UK’s listed market.
ABB’s offer values each Rotork share at 503 pence in cash, a premium of around 60% to Rotork’s latest three-month average share price, according to ABB’s announcement. The deal implies an enterprise value of around $5.5 billion, at roughly 19.5x Rotork’s 2025 adjusted EBITDA. The snippet cited a 73% premium, reflecting a different reference price: Wednesday’s closing price rather than the three-month average.
ABB described the transaction as its biggest-ever deal. Rotork, which supplies flow control equipment to the oil and gas sector, recorded revenues of around $1 billion in the financial year ended 31 December 2025 and an adjusted operating profit margin of 24.6%, with average annual organic revenue growth of 8% from 2022 to 2025.
The acquisition would add around 3% to ABB’s total group revenues and around 12% to its Automation business area revenues, The Manufacturer reported. ABB said it expects the EV/EBITDA multiple to fall towards the mid-teens once anticipated synergies are factored in. Rotork’s board unanimously recommended the offer, which will proceed via a court-sanctioned scheme of arrangement under the UK Companies Act 2006.
Rotork chair Dorothy Thompson said: ‘The Rotork board believes that the offer from ABB reflects the high quality of Rotork and recognises the significant progress delivered through the successful implementation of our Growth+ strategy, while providing an attractive opportunity for Rotork shareholders to accelerate the value creation of the company’s strong future prospects, in cash at closing.’
London Takeover Wave: Premiums and the Valuation Gap
The Rotork deal follows a week in which two other large UK-listed companies were acquired. Zurich agreed in principle to buy insurer Beazley for £8.1bn at a 59.8% premium, while Nuveen agreed to acquire asset manager Schroders for £9.9bn at a 34% premium.
Under Zurich’s proposal, Beazley shareholders would receive up to 1,335 pence per share, comprising 1,310 pence in cash plus permitted dividends of up to 25 pence in respect of the year ended 31 December 2025, according to Artemis. The combined group would have approximately $15 billion of gross written premiums. Beazley’s board said it would be minded to recommend the offer to shareholders, subject to satisfactory resolution of other terms. Zurich said it would begin confirmatory due diligence.
FTSE 250 budget airline EasyJet also agreed in principle to a £5.7bn takeover from Apollo at an 81% premium. The average premium across the 22 deals with public terms this year has reached 45%, according to AJ Bell.
Foreign buyers account for 86% of total deal value, with US acquirers representing half of all overseas approaches. Segro rejected a £12.6bn approach from US real estate firm Prologis, calling it ‘opportunistically timed.’ Testing company Intertek rebuffed three bids from Sweden’s EQT before accepting a £10.6bn offer.
Market Shrinks as Listings Fail to Keep Pace
Since 2023, there have been 154 bids for UK companies with a market value above £100m, erasing £165bn of stock market capitalisation, according to Peel Hunt. Against that, just 11 companies valued above £100m have listed in London, bringing total new capitalisation to £6bn.
Michael Field, chief European equity analyst at Morningstar, said: ‘It’s not that the UK is a market where everything is getting taken over. It’s that activity is very strategic and very specific. Certain targets with depressed valuations… are at the mercy of larger companies that see now as the time to swallow them up and bring down their own cost base.’
Field said the London takeover wave would continue ‘unless something drastic changes in the UK.’ Dan Coatsworth, head of markets at AJ Bell, said: ‘The ongoing takeover trend in general is bad for investors because it is reducing choice.’
Steven Fine, chief executive of Peel Hunt, called on the government to act, warning the trend ‘weakens the UK’s tax base and growth prospects.’ Writing on LinkedIn, Fine said: ‘The equity market is a strategic national asset… We lose tax revenues generated by advisers, lawyers, bankers, auditors and head-office employees. Pension savings are increasingly invested overseas, supporting growth in other economies rather than our own. It is a slow leak across multiple channels.’
With the Rotork scheme now proceeding to court sanction and Zurich still completing due diligence on Beazley, the pace of foreign bids on the London market shows no sign of easing heading into the second half of the year.
