Emerson Sells Three Business Divisions
Resource from: Power Transmission Engineering Likes:273
Aug 18,2016
Emerson recently announced that it has agreed to sell its Leroy-Somer and Control Techniques business units to Nidec Corporation. The transaction is valued at $1.2 billion and is expected to close by December 31, 2016, subject to regulatory approvals. The proceeds will strengthen Emerson’s balance sheet providing increased capacity for strategic investment.
“The Leroy-Somer and Control Techniques management teams and product leadership positions will provide a strong foundation for continued success under Nidec’s ownership,” said Chairman and Chief Executive Officer David N. Farr. “This announcement represents another step in our strategic repositioning to restructure and align our business amidst a challenging global macroeconomic environment. Upon completing the transaction, Emerson will be better positioned to accelerate growth and value creation over time, while Nidec will have a unique opportunity to strengthen its global motor presence and expand into drives and power generation. I am grateful to the employees of Leroy-Somer and Control Techniques for the strong and valuable performance they have provided for decades. We will work closely with Nidec to ensure a smooth transition for customers and employees.”
Leroy-Somer, headquartered in France, was acquired by Emerson in 1990. Control Techniques has been an Emerson business since 1995, and is based in the United Kingdom. For more than 30 years, Leroy-Somer and Control Techniques have been leading manufacturers and suppliers of alternators, drives, and motors, with approximately 9,500 employees around the world. The two businesses had combined FY 2015 revenue of approximately $1.7 billion.
In addition, Emerson also announced an agreement to sell Network Power to Platinum Equity and a group of co-investors. The transaction is valued at $4 billion and Emerson will retain a subordinated interest in Network Power. The sale of Network Power is expected to close by December 31, 2016, subject to customary regulatory approvals.
“This agreement marks a major milestone in the strategic portfolio repositioning we announced last June,” said Farr. “By selling Network Power to Platinum Equity, we have achieved a successful result for our shareholders as part of our plan to streamline Emerson to create a more focused company with significant opportunities for growth and profitability in our core served markets. We believe Network Power has a bright future ahead and Platinum Equity is well-positioned to help the company continue to thrive and realize its full potential.”
With revenue of approximately $4.4 billion in fiscal 2015, Network Power, based in Columbus, Ohio is a leading provider of thermal management, A/C and D/C power, transfer switches, services and information management systems for the data center and telecommunications industries.
"I'm very proud of the relationship and mutual trust that the Emerson and Platinum Equity teams have built with one another," said Platinum Equity Chairman and CEO Tom Gores. "Emerson is a world class company that we know shares our commitment to creating value, and this is an important investment in a business that will be a cornerstone in our portfolio. It plays to our core strengths. In addition to our capital resources, we will deploy our global operations skills to build on the foundation Emerson created and take this business to another level.”
The proposed sale marks Emerson’s second divestiture to Platinum Equity in the last three years. In November 2013 Emerson sold a 51 percent controlling stake in its embedded computing and power business, which Platinum Equity rebranded Artesyn Embedded Technologies.
"Emerson has been a great long-term partner and we are pleased to collaborate again,” said Platinum Equity Partner Jacob Kotzubei. “We have worked extensively with Emerson to customize a divestiture solution for Network Power that is beneficial for all sides and aligns with the long-term strategic goals of the business. Network Power is recognized as a global leader in infrastructure technologies and we are confident that working together with management we can further extend that position as a standalone company.”
Network Power will continue to be led by Scott Barbour, who has been executive vice president of Emerson and business leader for Network Power. Barbour added, “We firmly believe Platinum Equity is an ideal partner as we continue to drive efficiency in our operations and invest to bring innovative products and services to our customers. The work we’ve done at Network Power in recent years ensures we are well prepared for an ownership transition and have the right foundation in place to be successful.”
Emerson Electric Co.
Phone:
(314) 553-2000
URL:
www.emerson.com
(Power Transmission Engineering)
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1.The news above mentioned with detailed source are from internet.We are trying our best to assure they are accurate ,timely and safe so as to let bearing users and sellers read more related info.However, it doesn't mean we agree with any point of view referred in above contents and we are not responsible for the authenticity. If you want to publish the news,please note the source and you will be legally responsible for the news published.
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