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UPDATE 1-SPX Flow to explore strategic options after rejecting Ingersoll bid

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(Adds details from SPX's statement)

July 26 (Reuters) - SPX Flow said on Monday it would explore strategic alternatives, including a sale or merger of the company, after the industrial pumps and valves maker rejected Ingersoll Rand's sweetened $3.59 billion buyout bid last week.

SPX, which makes components for machinery used by industries such as food and beverages, had rejected Ingersoll's proposal, saying it undervalued the company.

Ingersoll raised its offer in June to $85 per share from its first bid to buy SPX in May at $81.50 apiece.

"The board concluded that (Ingersoll's) proposals did not adequately value the company in light of the board's confidence in the potential for increased profit margins and growth," SPX said in a statement on Monday.

SPX's shares closed at $76.12 on Friday.

Morgan Stanley and Co LLC is serving as SPX's financial adviser, while Winston and Strawn LLP is its legal adviser. (Reporting by Ankit Ajmera in Bengaluru; editing by Uttaresh.V)