Emerson receive $9.5 billion upfront for sale of stake in climate technologies business; beats Q4 profit expectations

Shares of Emerson Electric Co.
EMR,
+1.76%
gained 0.7% in premarket trading, after automation technology and software company confirmed Monday an agreement to sell a majority stake in its climate technologies business to Blackstone Inc.
BX,
+0.68%
in a deal that values the business at $14.0 billion. The deal was originally reported by The Wall Street Journal. Under terms of the deal, Emerson will receive upfront cash proceeds of $9.5 billion. At the close of the deal, which is expected to occur in the first half of 2023, Emerson will receive a note of $2.25 billion, and will retain 45% equity ownership of the standalone climate technologies business. Separately, Emerson reported fiscal fourth-quarter net income that rose to $740 million, or $1.24 a share, from $670 million, or $1.11 a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share of $1.53 beat the FactSet consensus of $1.39. Sales grew 8.3% to $5.36 billion, above the FactSet consensus of $5.34 billion. The stock has slipped 3.0% over the past three months through Friday, while the S&P 500
SPX,
+2.46%
has lost 5.6%.