Honeywell it has officially been approved to acquire a British company’s thermal gas solutions division for $5.1 billion, it announced Tuesday.The Morris Township-based conglomerate is buying the Elster Division of Melrose Industries plc, which has $1.8 billion in estimated 2015 sales.
“The acquisition of Elster adds outstanding technologies, strong well-recognized brands, energy efficiency know-how, and a global presence to the Honeywell portfolio,” Honeywell Chairman and CEO Dave Cote said in a prepared statement. “We see Elster as a great opportunity to deploy HOS Gold to drive new growth and greater profitability in each of Elster’s businesses. This acquisition is expected to generate strong future returns for our shareowners, consistent with what you have come to expect from Honeywell.”
Elster’s gas heating and gas, water and electricity metering business will be integrated with Honeywell’s Environmental & Energy Solutions business, part of Honeywell Automation and Control Solutions. Elster’s upstream and midstream gas applications business will be integrated with Honeywell Process Solutions, within Honeywell Performance Materials and Technologies.
The deal, which is subject to customary closing conditions and regulatory approvals, is expected to close on Dec. 29.