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Key Takeaways
- Honeywell International on Thursday announced the $1.9 billion purchase of aerospace and defense contractor CAES Systems Holdings to boost its defense portfolio.
- The company said the addition of CAES, which designs and manufactures advanced electronics systems, will enhance its defense technology offerings.
- The all-cash deal for CAES is expected to close in the second half of this year.
Honeywell International (HON) shares rose Thursday as the conglomerate announced it was buying aerospace and defense contractor CAES Systems Holdings from private equity firm Advent International for about $1.9 billion.
Honeywell said the all-cash deal “will enhance Honeywell’s defense technology solutions across land, sea, air and space, including new electromagnetic defense solutions for end-to-end radio frequency (RF) signal management.”
The company added that the acquisition will boost its established platforms and upgrade positions in several key areas, including work on the F-35 fighter and the Navy’s SPY-6 radar.
CAES Adds Potential for ‘Continued Growth’
Chief Executive Officer (CEO) Vimal Kapur said that the addition of CAES will advance Honeywell’s position “at the forefront of the defense industry’s most dynamic sectors and sets the tempo for continued growth across our aerospace business.”
CAES has 13 facilities in North America and employs about 2,200 people.
Honeywell said that the transaction is expected to be completed in the second half of 2024 and accretive to adjusted earnings per share (EPS) “in the first full year of ownership.”
Shares of Honeywell were up 0.9% as of 1:51 p.m. ET Thursday to $214.73, their highest level in almost a year and a half.