Emerson completes acquisition of NINews
October 11, 2023
ST. LOUIS. Emerson officials announced that the company has closed its acquisition of automated, military and commercial test and measurement system provider NI, at an equity value of $8.2 billion. NI will now become a segment within Emerson called Test & Measurement and will be consolidated into the Emerson Software and Control group. The Test & Measurement business will still be headquartered in Austin, Texas. NI reported $1.66 billion in 2022 revenue.
Emerson officials see the acquisition enabling the company to seek opportunities around secular trends like nearshoring, digital transformation, and sustainability and decarbonization. NI brings a portfolio of software, control and intelligent devices that is expected to accelerate Emerson's revenue growth aligned to its 4%-7% through the cycle organic growth target.
NI increases Emerson's end market exposure in discrete markets, which will be Emerson's second largest industry segment, and with approximately 20% of sales in software. Officials say the acquisition also increases Emerson's exposure to high-growth industrial software markets. NI increases Emerson's gross profit, with further adjusted EBITA margin expansion opportunities as the company delivers an expected $165 million of cost synergy opportunities by the end of year five via application of best practices from the Emerson Management System.
"Our acquisition of NI is a significant milestone in our efforts to transform Emerson and realize our vision of increasing growth, cohesiveness and end market diversification across Emerson's portfolio," says Emerson President and Chief Executive Officer Lal Karsanbhai. "We are pleased to welcome NI employees to Emerson and benefit from our shared visions and cultures, including our mutual commitment to innovation, operational excellence and sustainability. Together, we look forward to providing our customers more innovative and differentiated products, executing on our synergy targets and delivering increased shareholder value."
Ritu Favre has been named to lead the Test & Measurement segment as Business Group President. Ms. Favre joined NI in 2019 as Senior Vice President and General Manager of the semiconductor business and was promoted to Executive Vice President of Business Units last year, where she was responsible for driving growth across the semiconductor and electronics; aerospace, defense and government; transportation; and portfolio business units.
As a result of the transaction's closing, NI's common stock has ceased trading on the Nasdaq.