Honeywell Swoops In To Acquire CAES For $1.9B, Boosts Defense Business

Honeywell International Inc. HON disclosed an agreement to acquire CAES Systems Holdings LLC (CAES) from Advent International for about $1.9 billion in an all-cash transaction.

This acquisition represents about 14 times the estimated 2024 EBITDA on a tax-adjusted basis.

The buyout is expected to boost adjusted earnings per share in the first full year of ownership and is not subject to financing conditions.

The deal is anticipated to close in the second half of 2024, pending customary closing conditions and regulatory approvals.

Vimal Kapur, chairman and CEO of Honeywell said, “This acquisition further positions Honeywell at the forefront of the defense industry’s most dynamic sectors and sets the tempo for continued growth across our aerospace business,”

“With the integration of CAES’ solutions and capabilities, we will fortify our existing defense offerings, while also expanding our capabilities in pivotal areas like RF, radar and sensing technologies, to ensure a market-leading position in areas that are critical for global security,” Kapur added. 

Honeywell Aerospace Technologies president and CEO Jim Currier said, “CAES’ trusted position with top U.S. defense customers strengthens our existing relationships as we shape the future of the defense industry together.”

This is Honeywell’s third acquisition this year. Honeywell held cash and equivalents of about $12 billion as of the end of March.

Earlier this month, Honeywell raised its second-quarter and FY24 guidance following the completion of the acquisition of Carrier Global Corporation‘s CARR Global Access Solutions business.

Investors can gain exposure to the stock via Gabelli Commercial Aerospace And Defense ETF GCAD and Invesco Aerospace & Defense ETF PPA.

Price Action: HON shares are down 0.23% at $212.39 premarket at last check Thursday.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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