Tyco International executives ring the opening bell of the New York Stock Exchange, June 12, 2007. Reuters/Chip East

Johnson Controls Inc. and Tyco International Plc announced plans to merge, creating a company with revenue of about $32 billion that will be based in low-tax Ireland — a sign that market volatility has not derailed strategic mergers.

Milwaukee-based Johnson Controls, which has a market value $23 billion, makes heating and ventilation systems and car batteries, while Cork, Ireland-based Tyco, valued at $13 billion, specializes in fire protection systems.

The combined company will save about $150 million a year in tax by basing in Tyco's legal domicile, the companies said.

"The move would be consistent with Johnson Control's strategy of transforming from an auto supplier into a multi-industry leader," UBS analyst Colin Langan said in a client note.

Johnson Controls' shares were down 0.8 percent at $35.30 in early trading, while Tyco's were up 10 percent at $33.65.

Johnson Controls Inc. (JCI) | FindTheCompany

Johnson Controls' shareholders will own about 56 percent of the combined company and receive a cash consideration of about $3.9 billion.

The merger will create savings of at least $500 million in the first three years, the companies said.

The companies didn't provide an exact value for the merger.

The new company, to be called Johnson Controls Plc, will be headed by Johnson Controls Chief Executive Alex Molinaroli and will continue to trade on the New York Stock Exchange.

Johnson Controls has been preparing to spin off its automotive seating and interiors business and said on Monday the spinoff was on track for early first quarter of 2017.

Shares of Johnson Controls have lost more than a quarter of their value since the start of 2015, while Tyco's shares have fallen by over 30 percent.

Tyco was broken up into three companies after turnaround expert Edward Breen took the helm from former Chief Executive Officer Dennis Kozlowski, who was convicted in 2005 of grand larceny, securities fraud and other charges.

Under Breen, Tyco spun off its electronics and healthcare businesses in 2007. He expanded Tyco's security business with the $1.9 billion acquisition of Broadview Security in 2010.

In 2012, Tyco was again broken up into three pieces — one selling valves and controls for the energy market that merged with Pentair Inc., while its commercial fire and security businesses combined into "New Tyco" and traded under Tyco's symbol. The third piece consisted of the ADT North American residential security business.

Centerview Partners and Barclays were financial advisers to Johnson Controls, while Lazard and Goldman Sachs advised Tyco.