Honeywell to amass Air Merchandise’ LNG course of expertise and gear enterprise

Honeywell and Air Merchandise collectively introduced that Honeywell has agreed to amass Air Merchandise’ liquefied pure gasoline (LNG) course of expertise and gear enterprise for $1.81 billion in an all-cash transaction.

This represents roughly 13x estimated 2024 EBITDA.

Because of the acquisition, Honeywell will have the ability to supply clients a complete, top-tier resolution for managing their power transformation journey. The brand new holistic providing will embody pure gasoline pre-treatment and state-of-the-art liquefaction, using digital automation applied sciences unified underneath the Honeywell Forge and Experion platforms. This full-service resolution will allow environment friendly, dependable and optimized administration of pure gasoline property, delivering unparalleled worth and assist.

At the moment, Honeywell supplies a pre-treatment resolution serving LNG clients globally. Air Merchandise’ complementary LNG course of expertise and gear enterprise consists of a complete portfolio, together with in-house design and manufacturing of coil-wound warmth exchangers (CWHE) and associated gear. CWHEs present the very best throughput of pure gasoline in a single exchanger with a small footprint and sturdy, dependable and protected operations each onshore and offshore.

“Whereas the world continues to construct the renewables-based power infrastructure of the longer term, pure gasoline is a important lower-emission and inexpensive transition gas that can assist meet ever-increasing and dynamic international power calls for,” stated Vimal Kapur, Chairman and CEO of Honeywell.

“This extremely complementary acquisition will additional strengthen our power transition portfolio, and Air Merchandise’ CWHE expertise will instantly increase our put in base – creating new alternatives to compound progress in aftermarket companies and digitalization by our Honeywell Forge platform,” Kapur added.

“The choice to divest our LNG warmth exchanger expertise and gear enterprise displays Air Merchandise’ continued deal with its two-pillar technique — to develop our core industrial gasoline enterprise and associated expertise and gear, and to be a first-mover delivering clear hydrogen at scale to decarbonize industrial and heavy-duty transportation sectors,” stated Air Merchandise’ Chairman, President and Chief Govt Officer Seifi Ghasemi. “The LNG enterprise is a superb enterprise and at its strongest level in its decades-long historical past because of the excellent work of our folks, and they are going to be in good fingers to advance as a part of Honeywell’s associated portfolio of applied sciences.”

The LNG market has quadrupled over the previous 20 years and is anticipated to double over the subsequent twenty years, pushed by demand in key finish markets together with energy and knowledge facilities based on business analysis.1

Ken West, President and CEO of Honeywell’s Power and Sustainability Options (ESS) phase, stated, “The mixing of this proficient workforce and the acquired proprietary applied sciences will allow Honeywell UOP to deliver a full spectrum of scalable options and companies that assist our international clients navigate the advanced journey to extra sustainable and environment friendly power practices.” 

Air Merchandise’ LNG Enterprise has roughly 475 staff with headquarters in Allentown, Pennsylvania and a 390,000-square-foot manufacturing facility in Port Manatee, Florida, the place all sizes of CWHEs are made.

That is the fourth acquisition Honeywell has introduced this 12 months as a part of its disciplined capital deployment technique. The corporate is concentrated on high-return acquisitions that can drive future progress throughout its portfolio, which is aligned with the three compelling megatrends of automation, the way forward for aviation and power transition.

This transaction, which is anticipated to be adjusted earnings per share accretive within the first full 12 months of possession just isn’t topic to any financing situations and is anticipated to shut earlier than the tip of the calendar 12 months, topic to customary closing situations, together with receipt of sure regulatory approvals.

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