Security

What Now for Honeywell & UTC as Proposed Deal Fails to Get Off the Ground?

It’s been widely reported that Honeywell and UTC have been exploring the possibility of a merger. However it seems UTC rejected Honeywell’s $90 billion offer on grounds that the deal will never win US and EU antitrust approval. Since then Honeywell have made a vigorous counter statement insisting that regulatory obstacles need not prevent the merger suggesting it may still pursue UTC. Is this the only reason UTC are so far playing hard to get? Or are there other mitigating circumstances... In our recent article “How Will the Johnson Controls / Tyco Deal Play Out?” we suggested that the JCI / Tyco deal could well be challenged and amongst potential suitors we suggested that companies like UTC could now be analysing this merger both as a threat to their existing Fire and Security Operation or an opportunity to buy and significantly increase their market share. The irony of the proposed UTC deal may have be […]

Stay ahead of the pack

with the latest independent smart building research and thought leadership.

Have an account? Login

Subscribe Now for just $200 per year per user (just $17 USD per month) for Access to Quality Independent Smart Building Research & Analysis!

What Exactly Do you Get?

  • Access to Website Articles and Notes. Unlimited Access to the Library of over 1,700 Articles Spanning 10 Years.
  • 10% discount on ALL Memoori Research reports for Subscribers! So if you only buy ONE report you will get your subscription fee back!
  • Industry-leading Analysis Every Week, Direct to your Inbox.
  • AND Cancel at any time
Subscribe Now

It’s been widely reported that Honeywell and UTC have been exploring the possibility of a merger. However it seems UTC rejected Honeywell’s $90 billion offer on grounds that the deal will never win US and EU antitrust approval. Since then Honeywell have made a vigorous counter statement insisting that regulatory obstacles need not prevent the merger suggesting it may still pursue UTC.

Is this the only reason UTC are so far playing hard to get? Or are there other mitigating circumstances...

Merger

In our recent article “How Will the Johnson Controls / Tyco Deal Play Out?” we suggested that the JCI / Tyco deal could well be challenged and amongst potential suitors we suggested that companies like UTC could now be analysing this merger both as a threat to their existing Fire and Security Operation or an opportunity to buy and significantly increase their market share.

The irony of the proposed UTC deal may have be lost on Honeywell, who badly burnt their fingers when their proposal to merge with GE was finally turned down in 2005 by the Court of First Instance ("CFI"). The court upheld the judgment of the European Commission’s 2001 decision prohibiting the proposed merger.

The European Commission turned this down on the rather controversial issues of vertical and conglomerate effects including bundling. The CFI held that the Commission had not sufficiently proved its case. However thhe CFI saved the Commission’s face by affirming on the narrow grounds that, based purely on an analysis of horizontal overlaps, the Commission had correctly found that the merger would increase GE’s already existing dominant position in the markets for jet engines for large regional aircraft, engines for corporate aircraft and small marine gas turbines.

UTC does not hold such a strong position in jet engines of commercial aircraft as GE so it should stand a better chance of being accepted. However forced marriages very rarely work so well.

[contact-form-7 id="3204" title="memoori-newsletter"]

Honeywell and UTC will move on. So will either of these companies gatecrash the merger between Johnson Control and Tyco? We believe that if UTC don’t take this opportunity they may decide to sell off their Fire and Security business together with Building Controls. They have made little impression in these markets over the last ten years and yet are very strong competitors in all other building technologies.

Now they may have another option to strengthen their building technology operation... and that is to buy Honeywell's Building Solutions business. The Wall Street Journal says Honeywell has hired Goldman Sachs Group to work on the sale, which has been ongoing for about three months. The business unit is worth between $3 and $4 billion providing Integrated Building Management Systems.

Our recent report on The Physical Security Business 2015 to 2020; Access Control, Intruder Alarms & Video Surveillance discusses M&A in Fire and Security in more depth - http://memoori.com/portfolio/physical-security-business-2015-access-control-video-surveillance/.

Most Popular Articles

smart building startup
Smart Buildings

What is the Recipe for Smart Building Startup ‘Success’?

In smart buildings, like all tech industries, most startups set out hoping to be the game-changing company that puts a “dent in the universe” but the reality is that few even get close. Despite all the hype around so many startups, the odds of “success” if you are funded by a top venture capital (VC) […]

CXApp CXAI 2024
Smart Buildings

CXApp Workplace Experience Business and Financials Examined

In this Research Note, we examine the CXApp workplace experience business and 2023 financials, following the SPAC merger with KINS Technology in 2022 and subsequent events. Founded in 2015, CXApp is a workplace experience platform for enterprise customers in a work ‘from-anywhere’ world for employees, partners, customers, and visitors. Functionalities offered include employee engagement, desk […]

Witco Acquisition
Smart Buildings

Consolidation in the Workplace Experience Market as Witco Acquires SharingCloud

This Research Note examines what’s behind Witco’s latest move to acquire SharingCloud. We review the deal in the context of the startup’s development, funding, prior acquisitions, and strategy. Witco Profile Witco, a Parisian startup was founded in 2016 as MonBuilding, serving the French and Canadian enterprise market for workplace engagement apps. After raising 2 million […]

Subscribe to the Newsletter & get all our Articles & Research Delivered Straight to your Inbox.

Please enter a valid email

Please enter your name

Please enter company name

By signing up you agree to our privacy policy