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Schneider Electric enters ‘exclusive’ talks to sell CST
Schneider Electric has formally announced that it has entered into exclusive negotiations with two private equity groups, The Carlyle Group and PAI Partners, to buy its Custom Sensors & Technologies (CST) business, based on a $900m valuation for the operation.
As part of the proposed transaction – which has been rumoured for several weeks – Schneider would reinvest around $100m alongside Carlyle, PAI and some of CST's managers, to keep about 30% of the business.
CST designs and manufactures sensing, control and motion products. Its brands include BEI, Crouzet, Crydom, Kavlico, Newall and System Donner Inertial and in 2013 it generated revenues worth around $600m. The US-headquartered business is currently part of Schneider’s Industry sector.
Schneider says that the proposed sale would be consistent with its practice of reviewing its portfolio regularly, and its focus on energy management and efficiency technologies. It adds that CST has limited synergies with its other businesses and the proposed shareholding structure is designed to support CST’s future growth.
Schneider is currently consulting with its French works councils and with all parties that will be involved in the final negotiations to complete the sale.
