Vertiv Buys E&I Engineering Ireland For At Least $1.8 Billion, Lowers Guidance

(RTTNews) - Vertiv Holdings Co (VRT), a critical digital infrastructure and continuity solutions provider, on Wednesday announced its decision to acquire E&I Engineering Ireland Limited and its affiliate, Powerbar Gulf LLC.

The deal includes about $1.8 billion in upfront payment, consisting of $1.170 billion in cash and approximately $630 million of Vertiv common stock.

E&I is also entitled to receive up to $200 million in cash on achieving certain profit targets in 2022.

The transaction is expected to close in the fourth quarter of 2021.

Electrical switchgear and power distribution systems provider, E&I is expected to report annual sales of about $460 million in 2021.

The company said E&I's products represent a critical system of the data center power infrastructure and compete in an addressable market of about $7 billion, which is expected to grow 5% annually through 2025.

"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," said Rob Johnson, Vertiv's Chief Executive Officer.

Additionally, the company has lowered its third quarter and full-year outlook, citing supply chain challenges expected to continue through the first half of 2022.

The company sees net sales to be in the range of $1.21 billion- $1.25 billion in the third quarter, lower than 1.26 billion- $1.3 billion expected earlier.

Adjusted earnings for the quarter are expected in the range of $0.17 - $0.20, compared with prior guidance of $0.26 - $0.30.

Analysts polled by Thomson Reuters expect the company to report earnings of $0.29 per share on revenue of $1.28 billion for the quarter. Analysts' estimates typically exclude special items.

For the full year, net sales are expected in the range of $4.880 billion - $4.940 billion, below its previous view of $4.97 billion- $5.03 billion.

Adjusted EPS is expected in the range of $0.96 - $1.01 compared with $1.12 - $1.18, projected earlier.

The consensus estimate for earnings is $1.17 per share and for revenue is at $5.01 billion for the year.