Summary
Emerson Electric Co. (EMR) has officially completed the sale of its network power systems business, as announced on November 30, 2016, for $4 billion in cash. This divestiture is a significant step in the company's strategic portfolio repositioning. The buyer is a group of entities controlled by affiliates of Platinum Equity Advisors, LLC. While the primary cash consideration is substantial, Emerson will also retain a subordinated interest in future distributions, contingent on the equity holders achieving a certain initial investment return.
Key Highlights
- 1Completion of the sale of Emerson's network power systems business for $4 billion cash, subject to post-closing adjustments.
- 2The transaction was finalized on November 30, 2016, with the buyer being entities controlled by affiliates of Platinum Equity Advisors, LLC.
- 3Emerson will retain a subordinated interest in distributions, dependent on the buyer's equity holders receiving a threshold return on their investment.
- 4This divestiture aligns with Emerson's previously announced strategic portfolio repositioning efforts.
- 5Unaudited pro forma consolidated balance sheet as of September 30, 2016, is provided as Exhibit 99.2.
- 6Results from the divested network power systems business were already reported as discontinued operations in prior SEC filings.
Frequently Asked Questions
Emerson Electric Co. sold its network power systems business for $4 billion in cash, subject to post-closing adjustments. This was announced on November 30, 2016.
The business was acquired by a group of entities formed on behalf of, and controlled by, affiliates of Platinum Equity Advisors, LLC.
Yes, Emerson retained a subordinated interest in distributions from the business. This interest is contingent upon the equity holders of the buyer first receiving a specific threshold return on their initial investment.
The sale is part of Emerson's stated strategic portfolio repositioning, indicating a move to streamline its business segments and focus on core areas.