Air Products sells LNG business for $1.8B

Air Products is selling its liquefied natural gas (LNG) business for $1.81 billion, in a move that will affect around 475 employees.

Honeywell and Air Products jointly announced Tuesday that Honeywell has agreed to acquire Air Products' LNG process technology and equipment business for $1.81 billion in an all-cash transaction. This represents approximately 13 times the business’ estimated 2024 EBITDA.

"The decision to divest our LNG heat exchanger technology and equipment business reflects Air Products' continued focus on its two-pillar strategy -- to grow our core industrial gas business and related technology and equipment, and to be a first-mover delivering clean hydrogen at scale to decarbonize industrial and heavy-duty transportation sectors," said Air Products' Chairman, President and Chief Executive Officer Seifi Ghasemi. "The LNG business is a great business and at its strongest point in its decades-long history thanks to the outstanding work of our people, and they will be in good hands to advance as part of Honeywell's related portfolio of technologies."

Ghasemi noted that the LNG market has quadrupled over the past 20 years and is expected to double over the next two decades, driven by demand in key end markets including power and data centers according to industry research

Honeywell said that with the acquisition, it will be able to offer customers a comprehensive solution for managing their energy transformation journey.

Currently, Honeywell provides a pre-treatment solution serving LNG customers globally. Air Products' complementary LNG process technology and equipment business consists of a comprehensive portfolio, including in-house design and manufacturing of coil-wound heat exchangers (CWHE) and related equipment. CWHEs provide the highest throughput of natural gas in a single exchanger with a small footprint and robust, reliable and safe operations both onshore and offshore.

"While the world continues to build the renewables-based energy infrastructure of the future, natural gas is a critical lower-emission and affordable transition fuel that will help meet ever-increasing and dynamic global energy demands," said Vimal Kapur, chairman and CEO of Honeywell.

Air Products' LNG Business has approximately 475 employees with headquarters in Allentown, Pennsylvania and a 390,000-square-foot manufacturing facility in Port Manatee, Florida, where all sizes of CWHEs are made.

This is the fourth acquisition Honeywell has announced this year as part of its capital deployment strategy. The company is focused on acquisitions that will drive future growth across its portfolio.

The transaction is expected to close before the end of the calendar year, subject to customary closing conditions, including receipt of certain regulatory approvals.

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