ST. LOUIS — Blackstone Inc., an investment firm managing more than $990 billion in assets, on May 31 completed its acquisition of a majority stake in Emerson’s climate technologies division in a transaction that valued the business at approximately $14 billion.

The new standalone business, with a product line that includes compressors, controls, thermostats, valves, software, and monitoring equipment for the residential, commercial, and industrial HVACR markets, will be named Copeland, a nod to that brand’s 100-year legacy. Emerson Climate Technologies, now Copeland, had net sales of $5 billion in the 2022 fiscal year.

Blackstone and Emerson in October had jointly announced plans for the spinoff.

“Copeland has long been a pioneer in the HVAC and refrigeration industries, with unmatched capabilities in engineering, design and innovation,” said Copeland CEO Ross B. Shuster in a press release. “With the focus that comes from being a stand-alone company and the support of our shareholders, Blackstone and Emerson, we plan to extend the company’s leadership position in the industry and develop new and integrated climate technology solutions.”

Emerson, a global technology company, receives about $9.7 billion in pre-tax proceeds and a seller’s note worth $2.25 billion in the deal, plus retains a 40% equity stake in the new company.

The spinoff is seen by analysts as a vote of confidence in Emerson’s climate technologies division and the future of the HVACR industry as a whole.

“Blackstone’s investment … is confirmation that the electrification growth story is real,” said Brian Loftus, market research and benchmarking analyst at Heating Air Conditioning and Refrigeration Distributors International (HARDI), a trade group for HVACR distributors, shortly after the deal was announced. “Blackstone is not a slash-and-dash investor. They see the strategic value and potential of climate technology, as does Emerson.”

“This is further confirmation that the financial world has recognized the resilience of the HVAC industry,” said Matt Michel, the recently retired president of Service Nation Inc. “While HVAC may lack the ‘wow’ factor of some of the tech flavors of the day, we perform on a steady basis.”

“Copeland has grown into the market leader in supplying critical components for residential, commercial, and industrial climate control solutions, and we are thrilled to support its next phase of growth as a world-class stand-alone company,” said Joe Baratta, global head of private equity at Blackstone. “Leveraging Blackstone’s long track record of successful large-scale corporate partnerships, we look forward to working with the Copeland and Emerson teams to accelerate the company’s profitable, long-term growth.”

“We are pleased to complete this significant transaction, an important milestone in Emerson’s portfolio transformation into a cohesive global automation leader,” said Lal Karsanbhai, Emerson president and CEO. “The upfront proceeds from this transaction allow Emerson to advance our portfolio in attractive, higher-growth automation markets, while our remaining non-controlling investment enables Emerson to benefit from Copeland’s future upside under Blackstone’s ownership, until we exit the business.”

Copeland will be headquartered in the St. Louis area, where Emerson is based, while operating in markets in North America, Europe, Latin America, Asia, the Middle East, and Africa.