Honeywell has announced its agreement to acquire Sundyne from Warburg Pincus for $2.16 billion in an all-cash deal, reflecting a valuation of approximately 14.5 times the expected 2024 EBITDA. Sundyne specializes in the design and manufacturing of pumps and gas compressors for process industries, and this acquisition aims to enhance Honeywell's Energy and Sustainability Solutions (ESS) segment.
The integration of Sundyne's advanced products is expected to drive innovation and efficiency, addressing global energy security needs. Honeywell anticipates that Sundyne's established customer relationships and technology will unlock growth opportunities in refining, petrochemicals, LNG, and renewable fuels. The acquisition will also improve Honeywell's product offerings, particularly through the digitalization of Sundyne's equipment via Honeywell Forge, its IoT platform.
Vimal Kapur, Honeywell's Chairman and CEO, emphasized that combining Honeywell's technology with Sundyne's solutions will create strategic growth opportunities. The acquisition is expected to strengthen Honeywell's brand in the process industry and expand its aftermarket services.
Sundyne, headquartered in Arvada, Colorado, employs around 1,000 people and generates significant recurring revenue from its installed base. The integration is projected to yield substantial revenue synergies with Honeywell's existing capabilities and global sales reach. Ken West, President and CEO of Honeywell's ESS segment, noted that the combined offerings will provide a more comprehensive solution for customers.
Dan Zamlong, Managing Director at Warburg Pincus, expressed pride in Sundyne's leadership and its focus on diversifying markets and innovating products, which has positioned the company for sustained growth. Sundyne's CEO, Mary Zappone, highlighted the benefits of joining Honeywell, stating that the partnership will enhance growth and efficiency for customers.
The acquisition is expected to positively impact Honeywell's sales growth, segment margin, and adjusted earnings per share in the first full year post-acquisition. This move follows Honeywell's plans to separate its Aerospace Technologies business and spin off its Advanced Materials segment, aiming to create three distinct publicly listed companies with unique strategies.
Since December 2023, Honeywell has pursued various strategic actions to drive growth and simplify its portfolio, including approximately $9 billion in acquisitions and plans to divest its personal protective equipment business by the first half of 2025. The company is on track to exceed its commitment to invest at least $25 billion in high-return capital expenditures, dividends, and acquisitions through 2025.
The acquisition of Sundyne is anticipated to close in the second quarter of 2025, pending customary closing conditions and regulatory approvals.
