Honeywell to buy pump maker Sundyne for $2.16 billion

Reuters
03-04
UPDATE 4-Honeywell to buy pump maker Sundyne for $2.16 billion

Adds shares in paragraph 8, background in paragraphs 3, 5 and 7

March 4 (Reuters) - Honeywell International HON.O said on Tuesday it would buy pump-maker Sundyne from private-equity firm Warburg Pincus for $2.16 billion in cash, as the U.S. conglomerate strengthens its energy business ahead of a planned three-way split.

The industrial giant has focused on expanding its presence in the aviation, automation and energy sectors under CEO Vimal Kapur while shedding unrelated assets.

Arvada, Colorado-based Sundyne manufactures engineered pumps and gas compressors and provides aftermarket services. It operates in the U.S., as well as several countries in Europe and Asia.

The deal will add to Honeywell's unit that caters to the energy and petrochemical industries, while helping expand its aftermarket services business, Kapur said.

Honeywell made four acquisitions last year, including a purchase of liquefied natural gas-related unit of Air Products and Chemicals APD.N for $1.8 billion in June that had also added to the conglomerate's energy unit.

Last month, Honeywell announced a plan to split into three independently listed companies, months after activist investor Elliott Management took a $5 billion stake.

The activist investor had urged the conglomerate to split itself as its stock had underperformed compared with the market, but some experts have suggested gains from the planned separation could take time to materialize.

The company has forecast downbeat 2025 results. Its shares were marginally lower in early trading on Tuesday and have dropped more than 6% this year.

Sundyne's acquisition, which is expected to close in second quarter, will immediately contribute to sales growth, segment margin and adjusted earnings per share in the first full year of ownership, the company said.

Warburg had bought Sundyne in 2020 from funds advised by BC Partners Advisors L.P. and the Carlyle Group.

(Reporting by Aatreyee Dasgupta in Bengaluru; Editing by Shreya Biswas and Leroy Leo)

((Aatreyee.Dasgupta@thomsonreuters.com;))

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