Emerson Electric is to acquire the Outside Plant and Power systems business of Marconi Corporation for $375 million in cash.
The transaction is expected to close by the end of Emerson Electric’s fourth fiscal quarter, September 30, 2004, following regulatory review. It is expected to be accretive to fiscal 2005 earnings.
The Marconi power business itself, which is based in Lorain, OH, is a provider of DC power products, engineering and installation services and outside plant products to major telecommunication carriers throughout North America.
Its revenues for the year ended March 31, 2004, were approximately $380 million.
For Marconi, the divestment is the last of the businesses the company has identified as not being core to its ongoing business.
The acquisition by Emerson will allow it, on the other hand, to strengthen its presence with the regional Bell companies, inter-exchange carriers, wireless and cable companies in North America.
“We are delighted with this transaction, the cash proceeds from which will enable us to continue to reduce group debt and associated interest payments,” commented Mike Parton, Chief Executive of Marconi Corporation.