Emerson Announces $100 Million Investment in New and Upgraded Facilities in Texas, Brazil and China

This Follows Investment of More Than $100 Million in Past Six Months for Expansion and New Construction in Minnesota, Texas, China, Russia and Saudi Arabia

Emerson (NYSE: EMR) announced its Board of Directors recently approved new investment of about $100 million to build, expand or renovate several Emerson office and manufacturing facilities in Houston and McKinney, Texas; Nanjing, China; and Sorocaba, Brazil over the next two years.

These new investments are in addition to similar investment committed over the past six months by Emerson for technology centers, facility expansions, new regional headquarters offices and new construction at other Emerson locations in suburban Minneapolis, Minnesota; Austin and Houston, Texas; as well as Nanjing, China; Chelyabinsk, Russia; and Jubail, Saudi Arabia.

In some instances, Emerson is consolidating multiple locations into centralized facilities and, in others, new building and upgrades are designed to better meet customers’ needs on a local and regional basis.

“These new investments are in keeping with our ongoing strategy to efficiently and effectively reposition and strengthen Emerson in key locations around the world to best serve customers,” said Emerson Chairman and CEO David N. Farr.

Emerson in fiscal 2011 invested more than $600 million in total capital spending for new products, cost reductions and expansion and upgrade of its infrastructure. Plans call for that figure to be over $700 million in fiscal 2012, Farr said.

“Emerson is a financially strong company and we are investing globally for the next generation of innovation and growth, as global demand is still positive,” Farr said. “We continue to expand our capabilities and provide the highest quality and most energy efficient products and services to our customers.”

Projects approved by the Board at its October meeting include:

Investing $30 million to construct a new world engineering and manufacturing headquarters in Houston for the Emerson Process Management Valve Automation business. It includes the development of a 205,000-square-foot facility, with construction beginning in early 2012.
Building a three-story, 132,000-square-foot headquarters for Emerson Process Management’s Regulator Technologies in McKinney, Texas, to replace the existing 51-year-old facility there. The investment will be about $25 million. Construction is expected to begin in early 2012 and be completed in late 2013.
Investing nearly $20 million to retrofit a 58,000-square-foot manufacturing facility in Nanjing, China, where Emerson will make its InSinkErator brand food waste disposers and hot water dispensers specifically for consumers in China, to help that country manage municipal waste. Emerson’s disposers are viewed as an important technology for diverting waste from landfills.
Final investment to complete construction of a $24 million, 75,000-square-foot office and manufacturing shared services facility in Sorocaba, Brazil, that will be used by a number of Emerson businesses.

A decision is pending next month for a $20 million investment to build a new 143,000-square-foot manufacturing facility for its Leroy Somer alternator business in Noida, India, to replace an existing plant that will be sold to a local joint venture. If approved, the new building could be completed late next year.

Emerson employment worldwide at the end of 2010 was about 122,000 (includes impact of sale of Emerson’s Motors businesses) and today is about 134,000, an increase of about 12,000 jobs year-over-year. In that time, employment in North America has increased by about 1,000, with a similar increase in Western Europe. Recent investments will have a minimal initial impact on overall employment totals, and a number of factors influence each project.

It is also expected that these projects will result in a wide variety of new construction, engineering and other related jobs in major markets across the U.S. and overseas.

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