Emerson Electric Co. (St. Louis, MO) and Huawei Technologies' (Shenzhen, China) announced that Emerson has acquired Huawei's Avansys Power Co. Ltd. (San Jose, CA) unit for $750.0 million, gaining access to China's networking-power market.
Emerson said the acquisition would boost its position in China's potentially lucrative telecommunication and Internet markets.
Emerson's sales in Asia totaled $1.3 billion in 2000, and the company already has more than 10,000 employees in China.
"Avansys is an outstanding company with strong sales dynamics, high profitability and return on capital, and a young and talented workforce," said David N. Farr, Emerson's CEO. "Its products are very complementary with those provided by the other network power divisions of Emerson, including Astec Advanced Power Systems (formerly Nortel Advanced Power Systems), Emerson Energy Systems (formerly Ericsson Energy Systems) and Liebert.
Emerson's sales in the Asia region reached $1.3 billion in 2000, up from approximately $400.0 million in 1990. Its divisions operate 66 manufacturing facilities and 268 sales offices, employing about 19,000 people throughout the region. More than 10,000 of these employees are in China.
Avansys results will be consolidated into Emerson as of the company's first quarter of fiscal 2002. Emerson expects the addition to be accretive to earnings per share in the first year, and accretive to operating cash flow.
