12/11/2017 07:10 EST | Updated 12/11/2017 08:20 EST

Calgary-based water pipeline company accepts $509M offer from New York partner

CALGARY — A Calgary-based water pipeline technology and inspection company says it has agreed to be sold for more than half a billion dollars to New York-based Xylem Inc.

Pure Technologies Ltd. says the offering price of $9 per share or $509 million in cash is more than double its closing share price last Friday. The stock rose to $8.93 on Monday morning.

Xylem CEO Patrick Decker says Pure will help it provide cost-effective solutions to address worldwide concerns about aging water utility infrastructure.

Pure (TSX:PUR) has about 500 employees in corporate offices in Mississauga, Ont., and Columbia, Md., as well as regional offices in the United States, Mexico, Colombia, Australia and China. Most of its $126 million in revenue for the 12 months ended Sept. 30 was generated in North America.

Earlier this year, Xylem and Pure entered into a partnership in which Xylem represented Pure’s products and services in parts of the Middle East, India and Southeast Asia.

Xylem, which has 16,000 employees and annual revenue of US$3.8 billion, says it expects to achieve at least US$12 million in annual cost savings within two years of the close of the deal which requires shareholder and regulatory approvals.