"It will be interesting to see how investors receive it. A lot of Australian companies have had very poor experiences when expanding overseas so this certainly raises the risk profile of Reliance," said Michael McCarthy, chief market strategist at CMC Markets.

Reliance, which described itself as the world's leading manufacturer of brass PTC fittings, said the purchase would provide total synergies of more than $20 million in core earnings per year and that the acquisition would be supported by an equity raising of up to $1.10 billion.

An entity related to its chairman, Jonathan Munz, would use its full entitlement of $110 million of the capital raising and the acquisition was expected to close in June, Reliance said.

A successful acquisition would give Reliance "powerful diversification and currency exposures that some investors might prize", Mr McCarthy said.

"Today's deal certainly raises the potential rewards and the potential risks for Reliance as an investment."