he news release Emerson Electric (EMR) revealed on June 30thof 2015 will forever transform the company.
Here’s the critical part of the company’s release:
“ST. LOUIS, June 30, 2015 – Emerson today announced it plans to spin off its Network Power business via a tax-free distribution to shareholders as part of a plan to streamline its portfolio, drive growth, and accelerate value creation for shareholders. Emerson will also explore strategic alternatives for its motors and drives, power generation and remaining storage businesses.”
Emerson Electric is splitting apart.
The company was founded in 1890 and has paid increasing dividends for 59 consecutive years. Emerson Electric is one of only 17 Dividend Kings.
The company’s plan to spin-off the Network Power Division, and potentially several other business units will reshape Emerson Electric.
The effects of this restructuring are discussed in this article. First, let’s get to know Emerson Electric as it is currently.
As it is currently, Emerson Electric has over 130,000 employees and 230 manufacturing facilities around the world.
Emerson Electric divides its operations into 5 segments which represent its various business ventures. The 5 segments are listed out below:
Process Management
The process management segment provides products and services to help businesses control, regulate, operate, measure, and analyze the manufacturing or automation process.
Industrial Automation
The industrial automation segment sells power generation, electrical protection, power quality, power transmission, fluid automation, machine motion, and precision cleaning products, among others.
Network Power
Emerson Electric’s network power segment protects and optimizes power supply for critical infrastructure like data centers, communication networks, healthcare, and industrial facilities.
Climate Technologies
The climate technologies segment is the world’s leading provider of heating, ventilation, air conditioning, and refrigeration products for commercial, residential, and industrial applications. The segment operates under a variety of brand names including Emerson, Browning, Copeland, Dixell, and White-Rodgers.
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