US giant Honeywell International awaits shareholder decision on cash bid.

Honeywell has outbid investment vehicle Melrose in the chase for Novar, the group behind top electrical brands MK, Gent, Trend and ADE. The US giant trumped Melrose’s £744 million bid with a cash offer of £815 million.

The boards of Honeywell and Novar have agreed terms of a recommended all-cash offer for the entire issued ordinary and preference share capital of Novar. Shareholders were informed of the offer on 10 January and they now have until 3pm on 31 January to respond.

Commenting on the offer, David Cote, chair and chief executive officer of Honeywell said: “We are delighted to reach agreement with the board of Novar to acquire what we believe is an important asset for us in our further expansion into the European market. Novar’s Intelligent Building Systems (IBS) division fits perfectly into our growth strategy and allows us to offer a more complete line of products across a broader geography.”

Stephen Howard, chief executive of Novar, said: “The all-cash offer from Honeywell represents a significantly more attractive proposition to shareholders than Melrose’s unsolicited and hostile cash and share offer. It is a tribute to the management and employees of Novar that this business has developed to the point that a company of Honeywell’s stature is now set to acquire the Novar Group.”

The Honeywell offer signals the possible break up of Novar because the US giant is interested only in the IBS division. Honeywell would seek to raise capital by selling off unwanted assets.

Source

Electrical and Mechanical Contractor