The deal is the second-largest private equity takeover so far this year after Cerberus Capital's $9.1 billion agreement to merge its Albertson's supermarket chain with rival Safeway.
The deal was announced by Gates's owners, the Canadian private equity company Onex and the Canada Pension Plan Investment Board.
Gates is a leading producer of power transmission belts and fluid power products for the automobile and other industries.
The company garnered $2.9 billion in sales and $25 million in profits in the year ended September 28, 2013, according to a US securities filing.
Last December, Gates filed papers for an initial public offering. Gates last changed hands in 2010, when Onex and Canada Pension acquired the assets as part of the purchase of British engineering and manufacturing group Tomkins for about $5 billion.
Gates is based in Denver, Colorado, and has 14,300 employees.