Eaton Corporation reached a deal to purchase Cooper Industries for US$12.6bn today, which will also see Eaton become incorporated as an Irish company as it moves to capture more of the power market.

Both companies will eventually operate under the Eaton brand out of Ireland, where Cooper is incorporated, when the deal closes in the second half of 2012.

Eaton CEO and Chairman Alexander M Cutler said the deal provides Eaton with access to Cooper’s “diversified component brands, global reach and international distribution”, a mix that will be a “game changer” in the global power industry.

The deal is by no means small – according to the Financial Times it is the third-largest takeover announced for 2012.

Eaton said the combined company figures will be worth the outlay, though, with combined revenues of both companies in 2011 reaching US$21.5bn and EBITDA of US$3.1bn. It expects the companies will generate expected annual synergies of about US$535m by 2016.

In a presentation provided to analysts, Eaton said by 2015 it expects sales will grow by 12 to 14%, with 30% of sales generated from emerging markets.

Cooper specializes in power control and distribution components and lighting and safety and has a large presence in the US, EMEA and a presence in the Asia Pacific.

Cutler said the deal, however, is not only about synergy, by purchasing Cooper Industries Eaton will be better positioned to meet rising demand in the energy industry, fuelled by rising concern about power supply.

“This combination significantly expands our ability to better serve our customers with their demands for critical energy saving technologies as they address the impact of the world’s growing energy needs,” Cutler said.

Eaton said the purchase provides it with a platform for growth in power solutions that encompass primary and secondary distribution, grid automation and smart grid technologies and lighting, lighting controls and wiring devices.

These technologies will help it take advantage of aging power infrastructure such as the grid, and the increased spending being seen in energy and infrastructure.

It also hopes to expand its channel presence in the oil and gas, mining, energy efficiency and alternative energy industries

Cooper is Eaton’s first acquisition since 2008, when it purchased power quality company Phoenixtec for US$0.5bn and power control and distribution company Moeller for US$1.5bn.