Emerson (NYSE: EMR) today announced that it has signed an agreement to
acquire SPX Corporation’s 44.5 percent minority interest in EGS
Electrical Group, giving it 100 percent ownership of the business.
Emerson and SPX have jointly held the business since 1997, with Emerson
responsible for operational management and consolidation of results in
its Industrial Automation segment. The business had annual revenues in
2013 of more than $500 million.
“We are excited for EGS to become a wholly-owned business of Emerson,”
said Chairman and Chief Executive Officer David N. Farr. “Emerging
opportunities with our Process Management and Industrial Automation
businesses make this the right time to assume full ownership and realize
the synergies possible as a fully integrated business of Emerson. We are
grateful for the strong partnership with SPX over the years.”
As a global manufacturer of electrical products for commercial,
industrial, hazardous and adverse environments, EGS’ technologies are
highly regarded in their markets for durability, safety and quality.
Although EGS serves a wide range of markets, its oil, gas and chemical
participation has grown to more than half of total sales.
“Historically, EGS has been a high-quality, niche market participant,
with sales concentrated in North America,” Farr said. “As oil, gas and
chemical market opportunities have developed, the potential for growth
by leveraging Emerson’s strong Process Management and international
channels has become increasingly attractive, and can be best achieved
under full Emerson ownership.”
The transaction is expected to close within two months, subject to
required regulatory approvals. EGS sales and earnings will continue to
be consolidated in the Industrial Automation segment, while SPX’s
noncontrolling interest in earnings of EGS will cease. Emerson expects
the transaction to be slightly accretive to earnings per share in 2014.
The purchase price will be $571 million.
About Emerson
Emerson (NYSE: EMR), based in St. Louis, Missouri (USA), is a global
leader in bringing technology and engineering together to provide
innovative solutions for customers in industrial, commercial, and
consumer markets around the world. The company is comprised of five
business segments: Process Management, Industrial Automation, Network
Power, Climate Technologies, and Commercial & Residential Solutions.
Sales in fiscal 2013 were $24.7 billion. For more information, visit www.Emerson.com.
Copyright Business Wire 2013