Cleveland's century-old Eaton Corp. is now a subsidiary of Eaton Corp., plc, based in Dublin, following Eaton's $13 billion purchase of Cooper Industries.
Eaton Corp.'s world headquarters in Cleveland.
Eaton Corp. has acquired Cooper Industries for $13 billion, the largest acquisition in the Cleveland manufacturer's 101-year history.
The purchase of Cooper, a global electrical equipment company based in Houston and incorporated in Ireland, officially closed Friday following six months of legal hurdles.
The deal is "a transformational milestone that that expands our market segment reach, broadens our portfolio of products, services, and solutions, and strengthens our global geographic footprint," Alexander M. Cutler, Eaton chairman and chief executive officer, said in a statement.
The new company will have about 100,000 employees and do business in 150 countries. Annual sales are expected to easily exceed $20 billion.
Cooper's incorporation in Ireland added to its attractiveness because the tax rate there is 12.5 percent, a third of the 35 percent U.S. tax rate.
In order to meet Irish legal requirements for the purchase, Eaton incorporated a new company in Ireland, Eaton Corp., plc, -- and made the U.S. Eaton Corp. a subsidiary. Cooper Industries, plc, is now also a subsidiary.
Eaton, as a subsidiary of Eaton Corp., plc, will now have the same tax advantage as Cooper. Eaton is now expected to continue to pay the U.S. rate on its domestic sales and the lower rate on its overseas profits.
Eaton's headquarters will remain in Greater Cleveland.
Cooper was at one time also an Ohio company. Cooper began as a Mt. Vernon foundry in 1833.
"Cooper adds proven capabilities in utility power distribution, smart grid, lighting, lighting controls, wiring devices, and safety solutions to Eaton's strengths in power quality, power distribution and energy services," Cutler said.
"These complementary technologies further accelerate Eaton's growth as a global integrated power management company focused on one of the most challenging mega-trends of our time: the rising costs and increasing environmental impact of the world's growing energy use."
Eaton shareholders will own 73 percent of the new company. Trading of Eaton and Cooper on the New York Stock Exchange continued to the end of trading Friday.
Eaton's share price closed at $52.16, up 17 cents from Thursday. Cooper closed at $74.50 per share, down $4.85.
Eaton Corporation plc will begin trading Monday on the NYSE under the symbol ETN.
"We will soon be announcing the organizational structure for the combined operations," Cutler said.
"That leadership, working with a joint integration team of leaders from Eaton and Cooper, will be responsible for achieving the operational synergies we have identified. We anticipate the entire integration process will take 24 to 36 months, depending on business conditions."
Eaton has not indicated how the merger will affect employment levels here. The company is building its new headquarters in Beachwood and is expected to move from downtown Cleveland next year.