Emerson Electric Co. took the largest step in a year-old plan to overhaul its business by announcing two asset sales for USD 5.2 billion as it hunts for acquisitions to focus on industrial automation and consumer products.
Emerson will sell its network-power division to Platinum Equity and other investors for USD 4 billion. Emerson's plans to unload the underperforming businesses were announced in June of last year following disappointing earnings growth. The restructuring includes a cost-cutting program to save more than USD 400 million a year. The next step is to expand the refocused company through acquisitions.
Emerson plans to sell its ClosetMaid unit, which makes storage shelving and does not fit with the new focus. The company predicted after-tax cash proceeds from the deals of about USD 4.3 billion. Emerson retains an interest in the network-power division that will pay out if the business performs well.