Switzerland’s ABB (NYSE:ABB) unveiled a $3.1 billion deal on Tuesday to acquire U.S. industrial motors maker Baldor Electric (NYSE:BEZ) for a premium of 41%.

The move will allow ABB to penetrate the North American market as it attempts to become a global leader in industrial motion.

ABB said it will pay $63.50 in cash for each Baldor share, a 41% premium on the company’s closing price on Monday. Including $1.1 billion of debt, the total transaction is worth $4.2 billion.

“Baldor is a great company with an extremely strong brand in the world's largest industrial market," ABB CEO Joe Hogan said in a statement.

ABB said it sees the deal creating annual cost synergies and global revenue synergies of at least $110 million each. The companies expect the deal will close in the first quarter and add to ABB’s bottom line in its first year.

As part of the deal, ABB will locate its North American motor and generator business headquarters to Fort Smith, Ark., the home of Baldor.

“We are confident that the combined global platform will be well positioned to capitalize on meaningful growth opportunities in the future,” Baldor CEO John McFarland said.

McFarland plans to stay with the combined business to “support a successful integration.”
Baldor’s stock climbed 40.17% to $63.23 on Tuesday morning. In a possible show of support, ABB’s stock didn’t sell off in the wake of the deal, rising 0.10% to $19.59.