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U.S. industrials conglomerate Honeywell International said it agreed to buy Johnson Matthey’s catalysts unit for 1.8 billion pounds ($2.42 billion), lifting shares in the British platinum refiner.
The sale of the unit, which designs and produces catalysts for the chemicals and energy industries, is expected to deliver net sale proceeds of about 1.6 billion pounds to Johnson Matthey, the U.K. company said.
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Honeywell said it expects the acquisition to be accretive to earnings in the first year.
The combination of Johnson Matthey’s Catalyst Technologies business with Honeywell’s Energy and Sustainability Solutions unit will boost the group’s growth and create cost synergies, the U.S. group said.
The two businesses complement each other, Honeywell said, adding that it will for the first time be able to offer solutions for the production of lower emission fuels such as sustainable methanol, sustainable aviation fuel, blue hydrogen and blue ammonia.
Following the transaction, Johnson Matthey will focus on its Clean Air business and the processing of platinum group metals, the London-listed group added.
Shares in the U.K. chemicals company rose 33.2% in early morning trade Thursday on the back of the announcement. The stock is up 36% year to date, trading at 18.27 pounds.
The disposal comes after Johnson Matthey came under pressure from its biggest shareholder, the U.S.-based conglomerate Standard Industries, which said that Johnson Matthey’s board destroyed shareholder value.
In an open letter sent in January, Standard Industries highlighted what it called the “continued lack of urgency and incapacity of the current Board to do what is necessary to turn Johnson Matthey around and help it to realize its potential.”
The deal is the latest in a series of acquisitions of U.K. assets by U.S. companies, including DoorDash’s purchase of U.K. food delivery company Deliveroo.
Meanwhile, Johnson Matthey posted revenue of 11.67 billion pounds for the year ended March 31, down 9% on year.
Its operating profit grew to 538 million pounds from 249 million pounds, while pretax profit rose to 486 million pounds from 164 million pounds.
Analysts had expected revenue of 12.08 billion pounds, pretax profit of 733.3 million pounds, and operating profit of 793.4 million pounds, according to company-compiled consensus estimates.