© Air Products
© Air Products

Air Products to divest LNG business to Honeywell for $1.81bn

Air Products has signed a deal to divest its liquefied natural gas (LNG) process technology and equipment business to Honeywell for $1.81bn in an all-cash transaction.

The industrial gas giant today (10th July) confirmed the news and said the sale will increase its focus on its two-pillar strategy: to grow its industrial gas business, including related technology and equipment, and to be a first mover in clean hydrogen.

Post-acquisition, Honeywell will have a holistic offering that will encompass natural gas pre-treatment and state-of-the-art liquefaction, utilising digital automation technologies unified under the Honeywell Forge and Experion platforms.

Honeywell provides a pre-treatment solution serving LNG customers, but the full-service solution will enable efficient, reliable, and optimised management of natural gas assets, delivering unparalleled value and support.

Seifi Ghasemi, Chairman, President, and CEO of Air Products, said, “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.”

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.

In August 2023, the company announced that it would be increasing capacity at its LNG equipment manufacturing facility in Port Manatee, Florida, to meet industry demand and improve equipment delivery schedules.

Read more: Air Products increases capacity at LNG equipment site in Florida

Vimal Kapur, Chairman and CEO of Honeywell, confirmed that the acquisition will further strengthen the company’s energy transition portfolio and create new opportunities for compound growth in aftermarket services and digitalisation.

He said, “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.”

It has been estimated 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 centres, according to industry research.

The deal marks the fourth acquisition announcement made by Honeywell this year as part of its disciplined capital deployment strategy. The company says it is focused on high-return acquisitions that will drive future growth across its portfolio, aligned with the three megatrends of automation, the future of aviation, and energy the transition.

Air Products and Honeywell hope to close the deal before year end.

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