Market welcomes major changes for American Electric Power Company, Inc. Emerson Electric Co. (EMR.US) eventually offered $265 to acquire Aspen Technology, Inc. (AZPN.US)

The US industrial automation and energy management leader Emerson Electric Co. (EMR.US) stated that its offer to acquire Aspen Technology, Inc. (AZPN.US) at $265 per share is its "best and final" bid. If the two companies merge, it will bring significant changes to the market landscape of American Electric Power Company, Inc., making Emerson Electric Co.'s role in the power supply field even more important. Previously, the well-known activist hedge fund Elliott Investment Management had stated that the offer was too low. Aspen Technology, Inc. saw its stock price drop over 3% in pre-market trading, with the company's stock falling 2.64% to $267.550 before the deadline. Emerson Electric Co. stated in a release on Monday: "The price of $265 per share is the best and final price reached by Emerson and Aspen Technology, Inc.'s special committee after nearly three months of active negotiations." Before the release of this statement, Elliott Investment Management disclosed last Friday that it holds over $1.5 billion worth of shares in Emerson Electric Co. and has no intention to increase its stake in Emerson to participate in the acquisition. In addition, Emerson Electric Co. also added in its statement: "Emerson Electric Co. believes that the special committee of Aspen Technology, Inc., consisting of three independent directors, has a far better understanding of Aspen Technology, Inc. and its prospects, than the short-term shareholders who acquired Aspen Technology, Inc. stock for arbitrage and acquisition purposes." Last month, Emerson Electric Co. agreed to acquire the remaining shares of Aspen Technology, Inc. at $265 per share. Emerson Electric Co. originally proposed to acquire Aspen Technology, Inc. at $240 per share in November and raised the offer to $265 per share last month. As AI applications like ChatGPT sweep the globe, the energy demand of data centers worldwide is so massive that since 2024, some long-unfavored power supply utility stocks have entered the sights of top Wall Street investment firms. The global demand for AI training/inference-related AI computing power is accelerating, leading to a continuous surge in power resource demand from data centers, which are already known as "energy-hungry beasts." The exponential expansion of high-power AI data centers driven by AI computing infrastructure demand couldn't be possible without the core foundation of power supply, thereby forming the market view that "power is at the core of AI." Benefiting from the AI boom, Emerson Electric Co.'s stock price surged by 30% in 2024. Recently, OpenAI, SoftBank, and Oracle Corporation announced a super large-scale AI infrastructure construction plan named "Stargate," with an initial investment of $100 billion and a maximum expansion to $500 billion within four years, focusing on new and expanded AI data centers. The $500 billion investment plan for "Stargate" far exceeded market expectations and even garnered praise from some media outlets as the "Manhattan Project of a new era." US President Trump, returning to the White House, stated that the US government will provide all necessary conveniences to the "Stargate" project through emergency declarations, especially to meet all necessary power supply and underlying energy needs, as well as the urgently needed land/building permits. Emerson Electric Co. has long been focused on the domestic industrial automation, energy management, and power equipment sectors in the US market. In the market of American Electric Power Company, Inc., Emerson Electric Co. plays a vital role as a supplier of core equipment for power systems and core technology solutions for the grid, providing a variety of critical products and services for power generation, transmission, and distribution. For example, its process management division offers automation and grid control systems for power supply in multiple states in the US, while its environmental optimization technology division provides temperature control software and hardware integrated solutions for power infrastructure. Analysts generally believe that Emerson Electric Co.'s acquisition aims to strengthen the company's comprehensive capabilities in industrial automation and software, particularly in the automation and software integration capabilities in the energy and power industry. By integrating Aspen Technology, Inc.'s advanced industrial software, Emerson will be able to offer more comprehensive digital solutions, enhancing the overall efficiency of power grids in multiple states across the US. With the rapid development of artificial intelligence (AI) technology, the increasing demand for massive data processing and AI computing power is leading to a continuous rise in the demand for electricity. Through this acquisition, Emerson can fully utilize Aspen Technology, Inc.'s cutting-edge industrial software solutions to optimize power resource management and distribution across the US, meeting the strong demand for power in the AI era.