Honeywell to Acquire Sundyne for $2.16 Billion in Cash Deal

Honeywell (NASDAQ: HON) has announced its agreement to acquire Sundyne, a global leader in highly-engineered pumps and gas compressors, for $2.16 billion in an all-cash transaction. The deal, valued at approximately 14.5x 2024 EBITDA on a tax-adjusted basis, will strengthen Honeywell’s Energy and Sustainability Solutions (ESS) division, enhancing its ability to drive innovation, efficiency, and energy security worldwide.

Strategic Benefits of the Sundyne Acquisition

Sundyne, known for its cutting-edge process industry solutions, brings a diverse product portfolio and strong customer relationships that will help expand Honeywell UOP’s capabilities in key sectors such as:

• Refining and petrochemicals
• Liquefied natural gas (LNG)
• Clean and renewable fuels

The integration of Sundyne’s equipment with Honeywell Forge, a leading industrial IoT platform, will enable advanced digitalization, enhancing predictive maintenance and operational reliability. Additionally, Honeywell’s R&D capabilities will accelerate the development of next-generation pumps and compressors, strengthening its position in the process industries market.

CEO Vimal Kapur on the Acquisition

Honeywell Chairman and CEO Vimal Kapur emphasized the strategic growth potential of this deal:

“By integrating Honeywell’s advanced technology with Sundyne’s world-class solutions, this acquisition strengthens our Honeywell UOP business and unlocks new opportunities in high-growth verticals. Sundyne’s installed base of premium pumps and compressors further reinforces Honeywell’s leadership in the process industries while expanding our aftermarket services business.”

Sundyne’s Global Presence and Market Impact

Headquartered in Arvada, Colorado, Sundyne operates globally with approximately 1,000 skilled employees and a substantial recurring aftermarket revenue stream driven by its large installed customer base.

Honeywell anticipates that the acquisition will generate significant revenue synergies through:

• Expanded process licensing capabilities
• Modular system integration with Honeywell UOP
• Global sales expansion

Additionally, the acquisition is projected to be immediately accretive to Honeywell’s revenue growth, segment margins, and adjusted EPS in its first full year post-acquisition.

Honeywell’s Ongoing Portfolio Transformation Strategy

The Sundyne acquisition aligns with Honeywell’s broader portfolio transformation initiatives, following its recent announcement to separate its Aerospace Technologies business and spin off Advanced Materials. These changes aim to create three publicly traded industry leaders, each with distinct growth strategies.

Since December 2023, Honeywell has pursued strategic acquisitions and divestitures to drive organic growth and portfolio simplification, including:

• $9 billion in acquisitions, such as:
  • Access Solutions business from Carrier Global
  • Civitanavi Systems
  • CAES Systems
  • LNG business from Air Products
• The planned divestiture of its Personal Protective Equipment (PPE) business, expected to close in H1 2025.

Honeywell remains on track to exceed its $25 billion capital deployment commitment by 2025, investing in high-return capital expenditures, shareholder dividends, opportunistic share buybacks, and strategic acquisitions.

Regulatory Approvals & Expected Closing Timeline

The Sundyne acquisition is expected to close in Q2 2025, subject to regulatory approvals and customary closing conditions.

This strategic move reinforces Honeywell’s commitment to industrial innovation, positioning the company as a global leader in energy-efficient solutions while expanding its presence in high-growth industrial markets.

(Sources: investing.com, reuters.com)