Blackstone completed the acquisition of a majority stake in Emerson’s climate technologies business in a transaction valuing the business at $14 billion.
The new standalone business will be named Copeland, building on the brand’s 100-year legacy, brand recognition and influence across the HVAC and refrigeration (HVACR) industry. As a standalone company focused on serving the global HVACR market, Copeland’s product portfolio includes compressors, controls, thermostats, valves, software and monitoring solutions for residential, commercial and industrial customers. Copeland had fiscal 2022 net sales of $5 billion.
“Copeland has long been a pioneer in the HVAC and refrigeration industries with unmatched capabilities in engineering, design and innovation,” Ross B. Shuster, CEO of Copeland, said. “With the focus that comes from being a standalone company, and the support of our shareholders, Blackstone and Emerson, we plan to extend the company’s leadership position in the industry and develop new and integrated climate technology solutions. The Copeland business is made up of over 18,000 talented team members who are aligned and committed to developing technologies and solutions that drive decarbonization at scale, accelerate the global trend of electrification and deliver greater value for our customers and end users.”
Copeland is poised to build on its brand and expertise to shape the future of climate technology. The company’s products, expertise and innovation play a role in improving the energy efficiency of heating and cooling solutions, including the market for electric heat pumps and climate-friendly refrigerants.
“Copeland has grown into the market leader in supplying critical components for residential, commercial and industrial climate control solutions, and we are thrilled to support its next phase of growth as a world-class standalone company,” Joe Baratta, global head of Blackstone Private Equity, said. “Leveraging Blackstone’s long track-record of successful large-scale corporate partnerships, we look forward to working with the Copeland and Emerson teams to accelerate the company’s profitable, long-term growth. We’re confident in the runway ahead to advance Copeland’s industry leading position by delivering even more innovative, energy-efficient solutions to support its customers’ carbon reduction efforts.”
“We are pleased to complete this significant transaction, an important milestone in Emerson’s portfolio transformation into a cohesive global automation leader,” Lal Karsanbhai, president and CEO of Emerson, said. “The upfront proceeds from this transaction allow Emerson to advance our portfolio in attractive, higher-growth automation markets, while our remaining non-controlling investment enables Emerson to benefit from Copeland’s future upside under Blackstone’s ownership, until we exit the business. With our focused portfolio, we are bringing comprehensive automation products, software and solutions to a diverse set of end markets, driving operational excellence and enhancing value creation for Emerson shareholders.”
Copeland will continue to operate from St. Louis while maintaining a global footprint to serve customers in Europe, Latin America, Asia, the Middle East and Africa.
Centerview Partners and Goldman Sachs served as financial advisors to Emerson, while Davis Polk & Wardwell served as legal counsel and Baker McKenzie served as international legal advisor. Barclays served as lead financial advisor to Blackstone. Guggenheim Securities and Evercore also provided financial advisory services to Blackstone. The ABL revolver, TLB and senior secured notes for the acquisition were led by Wells Fargo, RBC Capital Markets and Barclays, respectively. Simpson Thacher & Bartlett acted as legal counsel to Blackstone.