By Nina Kienle

Shares in Smiths Group rose after the U.K. engineering company said it agreed to sell its security scanning unit to CVC Capital Partners in a $2.6 billion deal, and would return most of the proceeds to shareholders.

In morning trading, London-listed shares were up 1.4% at 2,464 pence.

Smiths Group said Wednesday that it agreed to sell Smiths Detection, which makes baggage and cargo scanners, to funds advised by CVC Capital Partners. The deal values the unit at 2.0 billion pounds ($2.64 billion), including debt and cash.

The sale is expected to complete in the second half of 2026, with Smiths anticipating net cash proceeds of around 1.85 billion pounds. The company plans to return a large part of these proceeds to shareholders, and expects to provide further updates on timing and mechanisms in due course, it said.

Earlier this year, Smiths said it would either spin off or sell the unit as part of a plan to focus on the John Crane and Flex-Tek businesses, after pressure from U.S. activist investor Engine Capital. The New York-based activist hedge fund in January called on the company to undertake a review of the business, which included either a possible sale of Smiths Group as a whole or in part.

The transaction builds on the recent sale of Smiths Interconnect to U.S. electronic components maker Molex Electronics for 1.3 billion pounds.

The sales of the detection unit and Smiths Interconnect represent a combined enterprise value of 3.3 billion pounds, Smiths said.

By streamlining its business, the FTSE-100 listed group is repositioning itself as a focused, high-performance industrial engineering company, it said.

Write to Nina Kienle at nina.kienle@wsj.com

(END) Dow Jones Newswires

December 03, 2025 04:51 ET (09:51 GMT)

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