The prospect of a bid battle powered Invensys (ISYS.L) shares to a ten-year high on Friday, after the British engineer said it had received a 3.3 billion pound ($5 billion) takeover proposal from France's Schneider Electric (SCHN.PA).

Invensys said Schneider, which confirmed only that it had made a proposal, was considering an offer of 505 pence a share in cash and stock, 15 percent above Invensys' closing price on Thursday.

A deal would allow Schneider to tap the British firm's strength in industrial automation, which is enjoying rapid growth in the oil, gas, petrochemicals and utilities sectors.

However, Invensys shares jumped as high as 513.5 pence on speculation the proposal could flush out other bidders.  U.S. group Emerson Electric (EMR.N) was in talks to buy Invensys a year ago, while a report in May 2012 said Germany's Siemens (SIEGn.DE), Switzerland's ABB (ABBN.VX) and U.S. giant General Electric (GE.N) had also made informal contact.

Those companies either declined to comment, or could not immediately be reached for comment.  "The most obvious candidate is Emerson, which was in related talks with Invensys back in June 2012," Societe Generale analysts said.

If a bid battle for Invensys breaks out, the share price could go even higher, said Neil Veitch, a fund manager at SVM Asset Management, which holds Invensys stock. However, a banker active in the sector said Schneider would be tough to beat. "You need to find someone willing to table an all cash bid," the banker said.

Invensys said it was likely to recommend an offer at 505 pence a share.  "Schneider is finishing its due diligence. There is a deal, there is a handshake," a source familiar with the matter said, speaking on condition of anonymity. He said he expected Emerson to look at Invensys because there were few companies like it available to buy. But Emerson could be put off by the price.

don't think there is anyone else out there," he said.

LONG SEEN AS A TARGET

Morgan Stanley analysts said the price proposed by Schneider was "fair and reasonable", valuing the British company at around 22 times earnings forecasts for 2014. That compares with an average multiple of 13 times for Britain's industrial machinery and equipment sector, according to Thomson Reuters data.

They said a deal would boost Schneider's share of the industrial automation market from just over 4 percent to around 6-7 percent, compared with world No.1 Siemens' 21 percent.

Analysts said a deal would also create an opportunity for Schneider to sell its energy management products to Invensys' customers in the oil, gas and petrochemicals sectors.

At 1503 GMT, Invensys shares were up 15.4 percent at 508 pence. Schneider's were down 3.9 percent at 55.81 euros on concerns it could get sucked into a bid battle and the cost of insuring its debt against default jumped on expectations it would raise new debt to fund a deal.

Invensys has long been mooted as a takeover target in an industry dominated by larger rivals, particularly after the disposal of its rail unit last year, which enabled it to strengthen its balance sheet and pension fund.

The British firm said Schneider's takeover proposal comprised 319 pence in cash and 186 pence in new shares for each Invensys share.

The French group, which said last summer it planned to step up acquisitions, has until August 8 to say whether it intends to make a firm offer or walk away under UK takeover rules. Activist investor ValueAct Capital Management has been building up a stake in Invensys. It holds 8.16 percent of the stock, according to Thomson Reuters data.  Barclays and JP Morgan Cazenove are advising Invensys, while Deutsche Bank and BofA Merrill Lynch are working for Schneider.

($1 = 0.6615 British pounds)

($1 = 0.7668 euros)

(Reuters)

Technip has been awarded by Forest BtL Oy a contract, worth approximately €5 million, for the front-end engineering and design (FEED) of a new second generation biomass-to-liquid* (BTL) plant to be built on Ajos island, Finland. This plant will produce approximately 140,000 tons of biodiesel and naphtha from wood and by-products from the wood-processing industry. This feedstock has many advantages as it is not used for human food, it does not jeopardize the existing local biomass usage and has a low CO2 footprint.

Technip will develop the process design package of the hydrogen production unit of the plant, based on its steam reformer proprietary technology, and will prepare the FEED for the hydrogen production, Fischer-Tropsch synthesis and refining units.

Technip’s operating center in Lyon, France, together with the Group’s hydrogen technology center in Zoetermeer, The Netherlands will execute the contract, which is scheduled to be completed in the first semester of 2014.

The Ajos BtL project is supported by the European Union NER300 funding program for innovative renewable energy technologies. This project will be an industrial first and will reinforce Technip’s leading position on new generation biofuels projects.

Foster Wheeler AG  has acquired Ingen Ideas ("Ingen"), a privately held upstream consultancy company located in Aberdeen, UK.

Ingen specializes in field development and project decision support, focused on the evaluation and implementation of oil and gas field developments covering greenfield and brownfield assets. Ingen's expertise includes field development, process engineering including subsea and topsides design, flow assurance, enhanced oil and gas recovery, carbon management and petroleum engineering.

Ingen will become part of Foster Wheeler's EMEA (Europe, Middle East, Africa) Upstream operations, which already has operations in Woking, Reading, Glasgow and Hull, all in the UK.

“The acquisition of Ingen is part of our stated strategy to grow our upstream capabilities, particularly for offshore, and to extend our offering to our clients to encompass the full oil and gas value chain,” said Kent Masters, Chief Executive Officer, Foster Wheeler AG. “The ability to provide high quality, high value-added consultancy services to our clients at a very early phase of the development of an oil and gas asset is a key factor in developing and extending long-term relationships with our clients, and also strengthens our position for future phases of these projects.”

ABB, the leading power and automation technology group, has announced its intention to acquire Dynamotive Ltd to expand its service offering in low and medium voltage drives and motors.

Coalville, UK–based Dynamotive designs, commissions and upgrades systems of drives, controls and motors for industrial and marine applications and automotive test rigs. Dynamotive has about 40 employees and is privately owned. Its owners will continue to work for ABB.“The acquisition of Dynamotive will enable ABB to expand its service operations including upgrade and retrofit capabilities in low and medium voltage drives. Furthermore, it will help ABB to increase its sales of complete industrial motion packages, which include drives, motors, controls and related services,” said Pekka Tiitinen, head of ABB's Drives and Controls business unit. “By combining Dynamotive’s service and engineering capabilities with ABB’s manufacturing capabilities and product know-how we will better serve our customers.”

Dynamotive will be integrated into ABB’s Drives and Controls business unit, led in the UK by Neil Ritchie. ABB is one of the world’s largest manufacturers of electric motors and drives. Drives adjust the speed of electric motors to match the actual demand of the application thereby improving productivity and energy efficiency.

“We are excited about the opportunity to join forces with ABB. We are confident that our customers and employees will benefit from the increased level and quality of services that we can offer them,’’ said David Perkins, Dynamotive’s managing director, who will continue to lead Dynamotive’s operations under the ownership of ABB. “Through this deal we will get better access to ABB’s drive, motor and control technology, as well as access to ABB’s global sales and service network.”