* Says to pay $10.10/share, deal valued at $118.8 mln

* Sauer-Danfoss shares rise as much as 26 pct

Dec 22  - Danish industrial group Danfoss A/S said it intends to offer about $118.8 million for the remaining stake in Sauer-Danfoss Inc (SHS.N), which makes hydraulic and electronic systems for mobile equipment.

The company said it intends to offer $10.10 per share in cash to the 24.3 percent public shareholders of Sauer-Danfoss, without interest and less any required withholding tax.

The offer is at a premium of about 11 percent to Sauer-Danfoss stock's closing price on Monday.

Danfoss said private ownership would assist Sauer-Danfoss in reaching its operational and strategic objectives, given the current challenging economic and competitive environment it is facing.

Danfoss plans to start the tender offer in the first week of January 2010.

Shares of Sauer-Danfoss were up 23 percent at $11.22 in Tuesday morning trade on the New York Stock Exchange. (Reporting by Divya Sharma in Bangalore; Editing by Gopakumar Warrier)