Emerson Electric agrees $14B Blackstone climate tech buyout

Emerson Electric Co. is selling a majority stake in its climate-technologies enterprises to Blackstone Inc. in a transformational deal for the industrial company valued at $14 billion including debt.

The deal would give Blackstone a 55% stake in the unit, which sells compressors and other HVAC services and products used in commercial and residential cooling, heating, and cold storage, executives from both firms said Emerson will retain the remaining 45% stake.

Blackstone and other investors would contribute $4.4 billion in equity toward the acquisition which will be used to supplement $5.5 billion of debt financing.

Blackstone said it believes the business it is buying would benefit from a shift to more energy-efficient cooling and heating technologies as consumers and businesses upgrade their systems to be more cost-effective and climate-friendly.

The unit, which comprises the majority of Emerson’s residential-and-commercial solutions business, had nearly $5 billion in sales during 2021-2022, which ended in September, and employs nearly 18,000. The majority of the firm’s sales are in the Americas.

The deal is the newest in a string of divestitures by Emerson. The firm has been focusing on streamlining its business and expanding its automation and technology offerings under CEO Lal Karsanbhai.