Vertiv to buy E&I Engineering Group for $2 billion
Vertiv is buying E&I Engineering Group, a maker of switchgear, busway and modular power solutions.
The purchase “completes” Vertiv’s data center offering and expands its addressable market by $7 billion, according to Vertiv’s announcement. Vertiv is paying $1.8 billion upfront, consisting of $1.17 billion in cash, and $630 million in Vertiv stock – with the potential for a further $200 million in cash based on achieving 2022 profit targets.
Founded in 1986 by Philip O’Doherty, who still serves as CEO, E&I has become known for its in-house integrated power designs and tailored technology offerings, with annual sales of around $460 million and 2,100 employees.
“The acquisition of E&I represents a key milestone in Vertiv’s strategy, completing our portfolio of in-building power train offerings for data centers and vital commercial and industrial markets,” said Vertiv CEO Rob Johnson. “The combination will amplify Vertiv’s growth opportunities and profitability, while enabling Vertiv to deliver differentiated solutions that manage a customer’s entire power infrastructure as an integrated system. We look forward to adding E&I’s highly skilled team members to the Vertiv family. Our companies share a strong culture of engineering excellence and innovation and a passion for serving our customers with differentiated products and service.”
It’s Vertiv’s first acquisition since it became a public company, via a merger with GS Holdings. “Our team has thoughtfully followed acquisition best practices during the process of identification, valuation, due diligence, and integration planning,” said Vertiv chairman Dave Cote. “E&I represents a unique opportunity for Vertiv and it fits well in the Vertiv portfolio. I am excited about the potential of these two great businesses coming together as one.”
O’Doherty welcomed the move: “This transaction brings together two highly complementary businesses and represents a great outcome for E&I’s employees and customers. We are excited to join the Vertiv team and to continue to grow our business through Vertiv’s global reach, strong channel presence and great customer positioning in critical digital infrastructures.”