Refrigeration company

Hussmann International

(HSM)

, turned red hot as its stock more than doubled Friday after accepting a merger bid from

Ingersoll-Rand

worth $1.56 billion.

Shares of the Bridgeton, Mo.-based company shot up 15 1/8, or 113%, to 28 1/2 by midday, well past its all-time high of 20 1/8. (Hussman closed regular trading up 15 3/16, or 114%, at 28 9/16.)

Ingersoll-Rand

(IR) - Get Report

shares have traded in a tight range near its opening price of 46 7/16. Ingersoll-Rand is up 11/16, or 2%, at 46 7/16 in midday trading. (Ingersoll-Rand finished up 9/16, or 1%, at 46 1/4 in regular trading.)

Under the terms of the deal, Ingersoll-Rand will pay $29 per share, a 117% premium to Thursday's closing price, for all of the 50.6 million Hussmann shares and redeem all outstanding Hussmann options. The companies said in a joint statement that the total value of the agreement is valued at $1.83 billion, which includes $275 million of debt.

Woodcliff Lake, N.J.-based Ingersoll-Rand, makes air compressors, construction equipment, golf cars and utility vehicles, pumps and temperature control systems.

Herbert Henkel, Ingersoll-Rand chairman, president and chief executive, said in a statement that the move expands the company's presence in climate control, a key global growth sector. The advent of e-grocers that build huge central warehouses for their products has created stronger demand for refrigeration products, he added.

The combination also allows Ingersoll-Rand to expand abroad at a lower cost by utilizing Hussmann's existing international operations.

"On a combined basis, our climate control operations will have revenues of approximately $2.8 billion by 2001," Henkel said in a statement. "We expect the profitable growth of this business to be enhanced as we realize cumulative operating synergies of more than $100 million by 2003." The savings should come from combined purchasing and procurement and improvements in manufacturing, general and administrative costs, Henkel added.