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Honeywell to acquire Air Products' LNG process technology business
PENNSYLVANIA, July 10, 2024
Global technology leader Honeywell has announced that it has reached an agreement with US-based Air Products to acquire its liquefied natural gas (LNG) process technology and equipment business for $1.81 billion in an all-cash transaction.
The transaction value represents approximately 13x estimated 2024 Ebita, the company said in a statement.
A world-leading industrial gases company in operation for over 80 years, Air Producs caters to several key sectors including energy, environmental, and emerging markets.
Headquartered in Pennsylvania, Air Products’ LNG Business has approximately 475 employees and a 390,000-sq ft manufacturing facility in Port Manatee, Florida, where all sizes of coil-wound heat exchangers (CWHEs) are made.
As a result of the acquisition, Honeywell will be able to offer customers a comprehensive, top-tier solution for managing their energy transformation journey, it stated.
The new holistic offering will encompass natural gas pre-treatment and state-of-the-art liquefaction, utilising digital automation technologies unified under the Honeywell Forge and Experion platforms. This full-service solution will enable efficient, reliable and optimized management of natural gas assets, delivering unparalleled value and support.
Currently, Honeywell said it provides a pre-treatment solution serving LNG customers globally.
Air Products’ complementary LNG process technology and equipment business consists of a comprehensive portfolio, including in-house design and manufacturing of CWHEs and related equipment. CWHEs provide the highest throughput of natural gas in a single exchanger with a small footprint and robust, reliable and safe operations both onshore and offshore.
“While the world continues to build the renewables-based energy infrastructure of the future, natural gas is a critical lower-emission and affordable transition fuel that will help meet ever-increasing and dynamic global energy demands,” said Vimal Kapur, Chairman and CEO of Honeywell.
“This highly complementary acquisition will further strengthen our energy transition portfolio, and Air Products’ CWHE technology will immediately expand our installed base - creating new opportunities to compound growth in aftermarket services and digitalization through our Honeywell Forge platform,” Kapur added.
Air Products’ Chairman, President and CEO Seifi Ghasemi said: "The decision to divest our LNG heat exchanger technology and equipment business reflects our continued focus on the two-pillar strategy - to grow our core industrial gas business and related technology and equipment, and to be a first-mover delivering clean hydrogen at scale to decarbonize industrial and heavy-duty transportation sectors.
“The LNG business is a great business and at its strongest point in its decades-long history thanks to the outstanding work of our people, and they will be in good hands to advance as part of Honeywell’s related portfolio of technologies,” he stated.
The LNG market has quadrupled over the past 20 years and is expected to double over the next two decades, driven by demand in key end markets including power and data centers according to industry research.
Ken West, President and CEO of Honeywell’s Energy and Sustainability Solutions (ESS) segment, said: “The integration of this talented team and the acquired proprietary technologies will enable Honeywell UOP to bring a full spectrum of scalable solutions and services that help our global customers navigate the complex journey to more sustainable and efficient energy practices.” -TradeArabia News Service