International. Honeywell announced today the completion of the acquisition operation, which was closed at a final price of US $4.95 billion.
The acquisition brings differentiated software capabilities by adding three brands to Honeywell's portfolio: Lenel S2, a leader in commercial and enterprise access solutions; Onity, which offers electronic locks, specifically hospitality access and mobile credentials; and Supra, which specializes in cloud-based electronic safes and programming software.
Global Access Solutions' approximately 1,200 employees are now part of Honeywell. The transaction is expected to be accretive to adjusted earnings per share in the first full year of ownership.
Honeywell will also benefit from the business' attractive growth and margin profile, valuable software content and recurring revenue mix, with expected annual sales in excess of US$1 billion when combined with Honeywell's existing security portfolio.
"As the world's security needs evolve toward a focus on protecting both people and critical assets, we see strong growth prospects for our acquisition of Access Solutions,"
said Vimal Kapur, CEO of Honeywell. "By leveraging our strong track record in delivering high-value building automation products, solutions and services globally, this acquisition creates an exciting opportunity for us to achieve faster growth and further margin expansion, while generating better results for our building automation customers.”
Honeywell updates outlook for 2024
Beginning in the second quarter, Honeywell will exclude the impact of acquisition-related intangible asset amortization expenses and other acquisition-related costs, including related tax effects, from segment earnings and adjusted earnings per share.
The company believes this change provides investors with a more meaningful measure of its performance from period to period, aligns the measure with how management will evaluate performance internally, and makes it easier for investors to compare our performance with that of its peers. .
Honeywell plans to provide historical non-GAAP financial data under this new basis to facilitate comparability when the company reports its second quarter results in July 2024.
As a result of the closing of the acquisition, Honeywell has updated its guidance for full-year sales, segment margin and adjusted earnings per share (based on revised calculation). Full-year sales are now expected to reach between $38.5 billion and $39.3 billion, including organic sales growth of 4% to 6%.
The segment margin is expected to be in the range of 23.8% to 24.1%, with segment margin expansion of 30 to 60 basis points. Additionally, adjusted earnings per share are expected to be in the range of $10.15 to $10.45. Also, operating cash flow is expected to be in the range of US$6.7 billion to US$7.1 billion with free cash flow of US$5.6 billion to US$6.0 billion.
Honeywell also updated its forecasts for second-quarter sales, segment margin and adjusted earnings per share. Second quarter sales are expected to be between US$9.3 billion and US$9.6 billion, with organic sales growth of 1% to 4%.
The segment margin is expected to be 22.7% to 23.1%, down 40 basis points from the same period last year. Adjusted earnings per share are expected to be in the range of $2.35 to $2.45, an increase of 2% to 7% compared to the prior year.
