US technology and engineering company Honeywell has agreed to buy Sundyne from private equity firm Warburg Pincus for $2.16bn in an all-cash deal which is expected to close in the second quarter.
Sundyne, headquartered in Arvada, Colorado with additional locations around the globe, specialises in the design, manufacturing and aftermarket support of highly engineered pumps and gas compressors used in process industries.
The addition of Sundyne’s differentiated equipment will boost Honeywell’s Energy and Sustainability Solutions (ESS) business, and marks another key industrial move following its $1.81bn purchase of Air Products’ liquefied natural gas (LNG) process technology and equipment business, which was completed last September.
Read more: Air Products completes $1.81bn LNG business sale to Honeywell
Sundyne’s technology will unlock strategic growth potential for Honeywell UOP’s value chains in refining and petrochemicals, LNG and clean and renewable fuels.
The deal will result in an improved product offering for customers as Honeywell Forge, a leading IoT platform, will enable the digitalisation of Sundyne’s equipment to enhance reliability and predictive maintenance.
Using Honeywell’s research and development capabilities, the combined company will also be able to further accelerate new product development in the pumps and compressors space.
Vimal Kapur, Chairman and CEO of Honeywell, said by combining Honeywell’s technology with Sundyne’s process industry solutions, the acquisition will enhance its Honeywell UOP business and create strategic growth opportunities in attractive verticals.
“Sundyne’s vast installed base of top-of-the-line pumps and compressors will further strengthen Honeywell’s brand in the process industry and create significant opportunities for us to continue expanding our aftermarket services business,” he said.
Sundyne brings approximately 1,000 skilled employees and a significant recurring aftermarket revenue generated from an extensive installed base.
The integration is expected to generate material run-rate revenue synergies with Honeywell UOP process licensing and modular capabilities, as well as a global sales reach.
The acquisition is expected to be immediately accretive to Honeywell’s sales growth and segment margin, as well as to adjusted EPS in the first full year of ownership.
The acquisition follows Honeywell’s recent announcement of the planned separation of its Aerospace Technologies business along with the previously announced spin of Advanced Materials, which will result in three publicly listed industry leaders with distinct strategies and growth drivers.
