Rockwell, which makes electronic motor starters, relays and timers for industries, has been strengthening its capabilities in the so-called Internet of Things (IoT), or technology that allows different devices and systems to communicate with each other over the internet.

Shares of PTC, which offers computer-aided design (CAD) programs as well as lifecycle management software for manufacturers, rose as much as 10.2 percent to a record $95.88.

“We do view this agreement as a strategic positive for PTC as it will help open the doors into thousands of companies that traditionally have not used PTC for its core CAD capabilities”, JP Morgan analyst Sterling Auty wrote in a note.

As part of the deal, Rockwell will acquire 10.6 million newly issued PTC shares for $94.50 per share, to become its third biggest shareholder.

The per-share price represents a premium of 8.6 percent to software maker PTC’s close on Friday.

Leveraging Rockwell’s domain expertise with PTC’s technology will help companies to capitalise on the promise of industrial IoT, PTC Chief Executive Officer Jim Heppelmann said.

Rockwell Automation’s chairman and Chief Executive Officer Blake Moret will join PTC’s board after the deal closes, which is expected within the next two months, according to a joint statement.