Carrier Announces Close of $4.95B Sale of its Global Access Solutions Business
Carrier Global (NYSE: CARR) announced the completion of the sale of its security business, Global Access Solutions, to Honeywell for $4.95 billion. This transaction is part of Carrier's strategic transformation into a focused global leader in intelligent climate and energy solutions. The net proceeds of $4 billion will be utilized to pay down debt, targeting a net leverage of approximately 2x EBITDA by the end of 2024. Additionally, Carrier plans to resume share repurchases in 2024. This sale follows the acquisition of Viessmann Climate Solutions, which is expected to significantly impact Carrier's growth and the industry. Carrier is also selling its global Commercial Refrigeration and Industrial Fire businesses and has started the process to sell its Commercial and Residential Fire businesses. This restructuring aims to position Carrier as a more focused, higher-growth company ready to tackle climate challenges.
- Sale of Global Access Solutions for $4.95 billion enhances liquidity.
- Net proceeds of $4 billion will be used to pay down debt.
- Targeting net leverage of approximately 2x EBITDA by end of 2024.
- Resumption of share repurchases planned for 2024.
- Completion of Viessmann Climate Solutions acquisition expected to be transformational.
- Ongoing sales of other non-core businesses to focus on high-growth areas.
- Debt reduction targets suggest current high leverage.
- Ongoing sales imply restructuring phase, which may cause short-term uncertainty.
- Dependence on successful sales and integration of other business units to achieve growth targets.
Insights
The sale of Carrier's Global Access Solutions business to Honeywell for
Additionally, the intention to resume share repurchases in 2024 signals strong confidence in their financial health and future growth prospects. Share repurchases can be beneficial for investors as they typically indicate that the company believes its stock is undervalued and can enhance earnings per share (EPS). This move, coupled with the ongoing portfolio restructuring, positions Carrier for higher growth and stronger focus on addressing climate challenges.
Carrier's divestment of Global Access Solutions aligns with their strategic focus on the climate and energy solutions market, a sector with substantial growth potential driven by global sustainability trends. With the increasing emphasis on energy efficiency and climate change mitigation, Carrier's pivot towards becoming a more streamlined entity can enhance its competitiveness and market positioning.
Moreover, the completion of this sale follows the acquisition of Viessmann Climate Solutions, indicating a clear strategic roadmap. This realignment not only consolidates their position in the climate solutions market but also indicates a potential for increased market share and influence. For investors, this transformation could mean a more resilient and growth-oriented investment.
- Advances Carrier's transformation into a focused global leader in intelligent climate and energy solutions
- Net proceeds of
$4B - Positions Carrier to resume share repurchases in 2024
"Today marks the first completed sale as part of Carrier's portfolio transformation," said Carrier Chairman & CEO David Gitlin. "Earlier this year we closed on our Viessmann Climate Solutions acquisition, which will be transformational for Carrier and the industry. We have agreements in place to sell the global Commercial Refrigeration and Industrial Fire businesses, both of which we plan to close in the third quarter. We have also initiated the sale process of our Commercial and Residential Fire businesses. Through these transactions, Carrier will transform into a more focused, higher-growth company ready to address important climate challenges. I want to personally thank the many talented Global Access Solutions employees for their contributions to the business and our customers over the years, and I look forward to watching this business continue to thrive under new ownership."
Carrier intends to use net proceeds from the sales to pay down debt, expecting to return to ~2x net leverage by the end of 2024. The company also expects to resume share repurchases in 2024.
Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC are serving as financial advisor to Carrier. Paul, Weiss, Rifkind, Wharton & Garrison LLP and Linklaters LLP are providing external legal counsel.
About Carrier
Carrier Global Corporation, global leader in intelligent climate and energy solutions, is committed to creating solutions that matter for people and our planet for generations to come. From the beginning, we've led in inventing new technologies and entirely new industries. Today, we continue to lead because we have a world-class, diverse workforce that puts the customer at the center of everything we do. For more information, visit www.corporate.carrier.com or follow Carrier on social media at @Carrier.
Cautionary Statement
This communication contains statements which, to the extent they are not statements of historical or present fact, constitute "forward-looking statements" under the securities laws. These forward-looking statements are intended to provide management's current expectations or plans for Carrier's future operating and financial performance, based on assumptions currently believed to be valid. Forward-looking statements can be identified by the use of words such as "believe," "expect," "expectations," "plans," "strategy," "prospects," "estimate," "project," "target," "anticipate," "will," "should," "see," "guidance," "outlook," "confident," "scenario" and other words of similar meaning in connection with a discussion of future operating or financial performance. Forward-looking statements may include, among other things, statements relating to future sales, earnings, cash flow, results of operations, uses of cash, share repurchases, tax rates and other measures of financial performance or potential future plans, strategies or transactions of Carrier, our portfolio transformation and the use of the anticipated proceeds thereof, potential future investments, Carrier's plans with respect to its indebtedness and other statements that are not historical facts. All forward-looking statements involve risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied in the forward-looking statements. For additional information on identifying factors that may cause actual results to vary materially from those stated in forward-looking statements, see Carrier's reports on Forms 10-K, 10-Q and 8-K filed with or furnished to the
CARR-IR
Contact:
Investor Relations
Sam Pearlstein
561-365-2251
Sam.Pearlstein@Carrier.com
Media Inquiries
Ashley Barrie
860-416-3657
Ashley.Barrie@Carrier.com
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SOURCE Carrier Global Corporation
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