Emerson Sells Power Transmission Business to Regal for $1.44B

Emerson Electric has agreed to sell its Power Transmission Solutions business unit to Regal-Beloit Corp., which owns a multitude of brands, manufacturing electrical motors and other components for commercial, residential, and industrial equipment.

The transaction values Emerson’s business unit at $1.44 billion. Emerson Chairman and CEO David Farr said the unit did not fit the company’s present strategy. “While the Power Transmission Solutions business no longer aligns with the strategic direction of our portfolio, it is a strong business with an outstanding management team that has created significant value while part of Emerson,” he said in a statement.

Emerson’s Network Power business is one of the biggest suppliers of electrical and mechanical equipment for data centers. It is well known in the data center industry for its Chloride UPS systems, Liebert cooling and power products, and Trellis data center infrastructure management software, among other brands.

According to Emerson, its Power Transmission Solutions business, which produces couplings, bearings, and drive components, among other products, as well as supporting services and solutions, reported 2014 revenue of more than $600 million. That makes it a major addition to Regal, which made about $195 million in profit on about $3.10 billion in revenue in 2013.

Emerson’s market capitalization is about $43.30 billion, while Regal’s is about $3.43 billion.