Emerson, a global automation leader, has successfully completed its acquisition of NI, a leading provider of software-connected automated test and measurement systems. The equity value of the acquisition stands at $8.2 billion.
This strategic move reinforces Emerson’s position in the automation industry and allows the company to take advantage of key trends such as nearshoring, digital transformation, sustainability, and decarbonization. With NI’s portfolio of software, control, and intelligent devices, Emerson expects to accelerate its revenue growth and achieve its 4-7% organic growth target. Additionally, the acquisition enhances Emerson’s presence in discrete markets, which will become its second largest industry segment.
NI’s expertise in software also increases Emerson’s exposure to high-growth industrial software markets. This will further contribute to Emerson’s gross profit and provide opportunities for expanded margins. By implementing best practices from the Emerson Management System, the company anticipates achieving $165 million in cost synergy opportunities within the first five years.
Lal Karsanbhai, President and CEO of Emerson, expressed his enthusiasm for the acquisition, stating that it marks a significant milestone in transforming Emerson’s growth, cohesiveness, and market diversification. He also emphasized the shared commitment to innovation, operational excellence, and sustainability between both companies.
As part of the acquisition, NI will become a new reported segment within Emerson called Test & Measurement. The business will continue to be headquartered in Austin, Texas. Ritu Favre, who has been appointed as the Business Group President, will lead the Test & Measurement segment. With her extensive technology experience and expertise in electronic test and measurement, Favre is confident in the ability of the newly formed business group to solve customers’ toughest challenges.
With the transaction complete, NI’s common stock will no longer trade on the Nasdaq. Emerson was advised by Goldman Sachs & Co. LLC, Centerview Partners LLC, and Davis Polk & Wardwell LLP. BofA Securities and Wachtell, Lipton, Rosen & Katz advised NI.
Emerson (NYSE: EMR) is a global technology and software company that provides innovative solutions for essential industries. By optimizing operations, ensuring personnel safety, and reducing emissions, Emerson helps manufacturers in hybrid, process, and discrete industries achieve their sustainability goals.
Source: PRNewswire