U.S. markets close in 30 minutes
  • S&P 500

    4,516.52
    -60.58 (-1.32%)
     
  • Dow 30

    34,438.31
    -201.48 (-0.58%)
     
  • Nasdaq

    14,999.75
    -381.56 (-2.48%)
     
  • Russell 2000

    2,147.50
    -58.83 (-2.67%)
     
  • Crude Oil

    65.72
    -0.78 (-1.17%)
     
  • Gold

    1,786.80
    +24.10 (+1.37%)
     
  • Silver

    22.55
    +0.23 (+1.03%)
     
  • EUR/USD

    1.1312
    +0.0006 (+0.06%)
     
  • 10-Yr Bond

    1.3430
    -0.1050 (-7.25%)
     
  • GBP/USD

    1.3233
    -0.0069 (-0.52%)
     
  • USD/JPY

    112.7500
    -0.4590 (-0.41%)
     
  • BTC-USD

    53,186.18
    -3,865.43 (-6.78%)
     
  • CMC Crypto 200

    1,346.18
    -95.58 (-6.63%)
     
  • FTSE 100

    7,122.32
    -6.89 (-0.10%)
     
  • Nikkei 225

    28,029.57
    +276.20 (+1.00%)
     

Vertiv Acquires E&I Engineering Group For $1.8B; Cuts Q3, FY21 Outlook

  • Oops!
    Something went wrong.
    Please try again later.
·2 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Vertiv Holdings Co (NYSE: VRT) has agreed to acquire E&I Engineering Ireland Limited and its affiliate, Powerbar Gulf LLC, for ~$1.8 billion, plus the potential for up to $200 million in cash. The upfront consideration consists of $1.17 billion in cash and ~$630 million of Vertiv common stock.

  • E&I is an independent provider of electrical switchgear and power distribution systems, with annual sales of ~$460 million (2021E) and 2,100 employees. The deal provides the opportunity to leverage Vertiv's footprint outside of the U.S., particularly in Europe and Asia.

  • The transaction is expected to be accretive to Vertiv's organic growth, adjusted operating margins, cash flow, and EPS in 2022, and is expected to close in 4Q21.

  • Vertiv plans to finance the deal with cash and new debt financing, supported by committed funding. It held cash and cash equivalents of 6.8 million as of June 30, 2021.

  • Vertiv orders in July and August were up ~12% year-over-year. Order growth drives a backlog of about $2.4 billion at the end of August, a 30% increase from year-end 2020.

  • Q3 Outlook: Vertiv lowered its outlook citing supply chain challenges. It sees net sales of $1.21 billion - $1.25 billion (prior $1.26 billion - $1.3 billion), and an adjusted operating margin of 10.3% - 10.8% (prior 12.3% - 12.8%). Adjusted EPS outlook of $0.17 - $0.20 (prior $0.26 - $0.30).

  • FY21 Outlook: The company expects net sales of $4.88 billion - $4.94 billion (prior $4.97 billion -$5.03 billion), an adjusted operating margin of 10.9% - 11.1% (prior 11.8% - 12.2%), and sees an adjusted EPS of $0.96 - $1.01 (prior $1.12 - $1.18).

  • Price Action: VRT shares are trading lower by 3.71% at $27.00 during the premarket session on Wednesday.

See more from Benzinga

© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.