Product category:
Building management systems
News Release from: Honeywell Specialty Materials
Edited by the Processingtalk Editorial
Team on 28 December 2004
Honeywell will buy Novar plc
Honeywell today announced that it has reached agreement with the board of directors of Novar plc on the terms of recommended Offers for the entire issued ordinary and preference share capital of Novar
Honeywell today announced that it has reached agreement with the board of directors of Novar plc on the terms of recommended Offers for the entire issued ordinary and preference share capital of Novar The Offers will be made on the basis of 185 pence per Novar ordinary share and 103.625 pence per Novar convertible preference share
This article was originally published on Processingtalk on 2 Mar 2005 at 8.00am (UK)
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In addition, holders of Novar ordinary shares will be entitled to retain a final 2004 dividend of 6.6 pence per share.
The aggregate value of the Offers is £1.2 billion (US $2.4 billion) fully diluted for the exercise of all outstanding options, including the assumption of approximately £300 million (US $580 million) of outstanding debt, net of cash.
The Novar board has unanimously recommended the Offers.
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The Offers will not be made in certain jurisdictions, including the United States.
Honeywell expects to fund the acquisition with existing cash resources and credit facilities.
The acquisition is expected to have an accretive impact on the Honeywell 2005 earnings per share.
Novar plc, with reported 2003 revenue of £1.43 billion (US$2.7 billion) is an international group whose core divisions are Intelligent Building Systems (IBS), Indalex Aluminum Solutions, and Security Printing Services.
The Novar IBS unit will enhance the Honeywell offering of security, fire and building controls products and services, particularly in the UK and Germany and support its strategy of global growth of these businesses.
Honeywell does not intend to hold Indalex Aluminum Solutions and Security Printing Services in the long-term and expects to pursue strategic alternatives for these units as soon as practical.
"This acquisition is an excellent opportunity to further expand our Automation and Control Solutions business," said David M.
Cote, Honeywell Chairman and CEO.
"Honeywell has a long heritage in providing premier integrated security, fire and building controls products and services.
We see great opportunities in this business, and the integration of Novar's highly complementary products, services and expertise clearly enhance those prospects.
Novar has a great heritage built on a competitive product offering, a talented workforce and a management team dedicated to delivering value to their customers.
Adding these assets to Honeywell's already strong global technology platforms will deliver benefits for customers and expanded opportunities for employees of both companies.
We look forward to working with Novar's management team to realise the benefits of this combination." Honeywell intends to integrate the Novar IBS unit, which had 2003 revenue of £603.9 million (US$1.2 billion) into its Automation and Control Solutions (ACS) division.
Honeywell ACS is an approximately $8.0 billion business with more than 40,000 employees worldwide.
Honeywell expects that the Novar IBS assets, its technology, business presence, customers and employees will contribute to the growth of its ACS division going forward.
Cote continued, "I am pleased that Novar's board has recommended our all-cash offer for Novar's ordinary and preference shares, which is expected to result in earnings accretion for Honeywell in 2005 and will deliver significant long-term value to our investors.
We believe we can achieve more than US$100 million annually in synergies.
Our integration team will work quickly and diligently to complete the transaction, and we look forward to smoothly integrating Novar's IBS business into our ACS operations." Honeywell expects to complete the acquisition in the first quarter of 2005.
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