Honeywell plans to enhance and strengthen its building automation capabilities with the acquisition of Carrier’s Global Access security business for $4.95bn in an all-cash transaction.

The acquisition, which includes hardware and software, supports Honeywell’s recently announced plans to align its portfolio to three megatrends: automation, the future of aviation and energy transition, underpinned by digitalisation capabilities.

The Carrier security business brings a growth and margin profile that should be accretive to Honeywell with software content, business model and sources of recurring revenue. The acquisition will add three brands to Honeywell’s portfolio with a focus on life safety and digital access:

• LenelS2, a business for over 25 years in commercial and enterprise access, including well-known offerings OnGuard and NetBox, used by numerous Fortune 100 companies.
• Onity, which offers electronic locks, including hospitality access, mobile credentials and self-storage access. Nine of the ten top hotel chains are users.
• Supra’s cloud-based electronic real-estate lockboxes offer mobile credentials and access management, as well as a digital platform to optimise scheduling for property showings.

When the deal closes, the combined company hopes to accelerate innovation, bringing products and capabilities to users that are increasingly moving to cloud-based services.

“Honeywell’s strong track record delivering building automation products and services makes this a natural fit that will create a leading security platform with forecasted annual revenue in excess of $1bn,” said Vimal Kapur, Honeywell CEO. “By leveraging the capabilities of the combined company’s advanced security and safety systems, customers will be able to maximise their performance, efficiency and cost-effectiveness and create long-term, sustainable value.”

With approximately 1200 employees operating in 33 countries, Carrier’s Global Access business specialises in access and security, electronic locking systems, and contactless mobile keys. This pending sale should allow the business to build on the strength of its brands, innovations, partner relationships and growth potential.

“Global Access is a great business with dedicated, customer-focused teams, and we look forward to watching its continued growth under the ownership of Honeywell,” said David Gitlin, CEO of Carrier (www.corporate.carrier.com). “The transaction, together with the planned exits of our industrial fire, residential and commercial fire, and commercial refrigeration cabinet businesses, will accelerate our growth strategy and focus, positioning Carrier to deliver higher growth and superior shareholder value and further reinforcing our track record of performing while transforming.”

The transaction is expected to close by the end of the third quarter of 2024, subject to customary closing conditions, including receipt of certain regulatory approvals. Evercore is serving as financial advisor to Honeywell (www.honeywell.com).

• Haier Smart Home has acquired Carrier’s commercial refrigeration business marking Haier’s expansion from its existing household refrigeration into the commercial refrigeration market.