Emerson submits proposal to acquire National Instruments for $53 per share

Emerson (EMR) announced that it submitted a proposal to the Board of Directors of National Instruments (NATI) to acquire NI for $53 per share in cash at an implied enterprise value of $7.6 billion. The proposal, which is not subject to any financing conditions, was submitted to NI on November 3, 2022, and represents an improvement over an initial $48 per share proposal submitted on May 25, 2022. Emerson has made numerous attempts to engage constructively with NI in private since May 16, 2022. The company said, "The proposal represents: Immediate and certain cash value for all NI shareholders; A 32% premium to NI’s closing share price as of January 12, 2023, the day prior to NI’s public announcement of a strategic review on January 13, 2023; A 45% premium to NI’s closing share price as of November 3, 2022, the day Emerson submitted its latest proposal to acquire NI; A 38% premium to the volume weighted average price for the last 30 trading days ending January 12, 2023; and A 23% premium to NI’s 52-week high intra-day share price of $43.12, as of January 12, 2023…The proposed transaction continues Emerson’s transformation into a global automation company. Benefits of the transaction include: Aligned with Emerson’s Portfolio Transformation Into a Cohesive, Higher Growth, and More Profitable Company: Emerson is actively transforming its portfolio to create a higher value, cohesive industrial technology portfolio serving a diversified set of end markets. With NI, Emerson would gain a strong, complementary portfolio of differentiated electronic test and measurement offerings, and a technology stack of industry-leading intelligent devices, controls and software that complements Emerson’s technology stack in its core automation markets. As outlined at Emerson’s November 29, 2022 Investor Conference, test and measurement is one of Emerson’s four priority segments. Further Diversification of End Markets: With favorable long-term trends and an estimated priority target TAM of $35 billion, test and measurement is a fast-growing and complementary adjacency to Emerson’s portfolio. This acquisition would enable Emerson to further expand and diversify its customer base within highly attractive end markets with strong secular trends including semiconductor, automotive and electric vehicles, and aerospace and defense. Significant Financial Benefits: The transaction is expected to be accretive to Emerson’s adjusted EPS in the first year, meets Emerson’s communicated returns threshold and will improve Emerson’s overall growth. NI has an attractive financial profile, with approximately 70% gross margins. NI’s business has strong positions in attractive and growing markets, creating sustainable top line growth potential. Emerson sees significant potential for profit and cash flow improvement across the NI business by applying proven operational excellence and productivity levers through Emerson’s Management System. Emerson’s Strong Commitment to the Transaction: Emerson believes its premium proposal will bring clear and realizable value to NI shareholders, who have faced years of share price underperformance across nearly any period. Underscoring its commitment to consummating a transaction, Emerson has purchased 2.3 million shares of NI stock and has received approval under HSR1 to increase its stake. Emerson believes that there is a path to a friendly transaction and urges NI shareholders to make their views known to NI’s management and Board. Furthermore, Emerson is prepared to nominate directors for election to NI’s Board."