Any hints from Carrier as to whether they’ll be selling to an existing company (a la Canon/Axis/Milestone, or a company like Acre) that is looking to add on ACS business or going a PE route to sell to a company looking to get some exposure to this market?
Carrier Seeks Few Billion Dollars For Fire & Security, Will Partially Spin/Split/IPO
Published Sep 18, 2023 12:35 PM
Carrier is progressing on its plan of divesting its fire and security businesses, sharing what it hopes to be paid and adding that it will spin, split, or IPO part of the business.
For background, see April 2023: Carrier Plan To Sell Fire & Security Analyzed and July 2023: Carrier To Split Up Sale Of Fire And Security.
In this note, we examine Carrier's plans, including the potential pricing and how they aim to deal now with three different parts in the exit.
3 *****
*******'* *** *** ********* *** **** will **** ***** *****, **** *** being **** *** *** *** ********** and *********** **** ******* ** *** business ***** ****** ** * ***-**-**-********** spin / ***** ** ***:
*** ******* ********* *** ***** *** timing:
**'** ******* ** *** ****** ************, *** ** **** ** ** the ****** ****industrial **** within the next 30 days. And then the remainder will be the part that we take into the public markets [commercial *** *********** ****]. [emphasis added]
"Clean ****"
******* **** *** ** ******* ********** businesses ** ******, ******* **** ****** about **** ****** ******* ** ***** or ***, ***. *******'* *** ********** "clean ****" ** ***** ****** *** priority:
** ****** **** **** ** *** priorities ** *** ** **** ** dispose ** ***** ******, ***** ** number ***, ** **** ** ***** exit. ** **** ****** ** **** of *** ******** ****** ** **** we **** ********** **** * ***** exit.
******** *** **** **** ***** ***** balances ****. ******* **** ******** **** total **** ** **** ***** ************ (instead ** ******* ** *** ** one) *** ****** *** ************* ** selling ********** ****** *** ** ***.
"Few *******"
******* ******* ** **** * *** billion ******* **** *** ****, ** the *** ********, "*** ****** ***** on *** **** *** ******** **** that **'** ******* ** * *** billion." **** ******* ** ** **********, if *** ************, ******** **** ** "few," **** **** *** ** ***** billion, ****** **** *** "***" ** mean **** ** ****. ******* *** not **** ********.
******* **** & ********. *** ********, generates **** $* ******* ** ****** sales *** * ~**% ********* ********* margin, ** ***** ***** *********:
* ***** ***** ** ~$* ******* for ********** ** **** & ******** would ** ** **** *** * business **** * ***** ********* ****** and ****** ******* ****** (*%, *.*., so *** **** ****).
******* **** *** ****** ** ******** only *****. ** ******** ** ** be *** ******** ** *** ******* fire & ******** ******** *** *** not ********* ** ******* **** *******.
Security **** **** *******
*** **** ** *** ******** **** is ********* ***** ***, ** ******* explained:
*** ****** ******* ** ******** **** prospective ****** *** ******** *** ********** refrigeration **** *** ********** *****, ****** recently **** *** *** ************ *********** memorandum.
* ********-**** **** **** / ** attracting *********** ******** ** ** ****** many ********* ******** ****** ** ***** more ******** ** **** *** ******** business.
****** ** ******** ******* ********** ** this **** **** ** *** ******, which ** * ********. *** ********, though, ** **** *******'* ******** ********** face *********** ******* **** ***** ****** that ********* *** *****, **********, *** lagging ********** (**** *** *********** ** cloud, ******, *** ** *** ********).
Debt *********
****, *******, *******'* *** ********** *** the ******** ** *** **** ***** be **** ** ****** ****, ********* so ** ****** *** ****** ***** for****** *** ******** ******* ********, ******:
******* *** ******** ***** **** **** to *** ****** ** ****** *** by *** *** ** ****. ***** happen ******. **'** ****** ***** ****** down **** **** ** ** ******* our ******** *****. *** **'** ****** about ***** * ***** *******, ****'* a ***** ************ **** *** $*.* billion **** **'** ******* ** **** of *** ******** ***********.
Call ********* *******
****** ** *******'* *** ******* *** deals ** * ********* **** ******** conference:
Timing *** ******** **** *****?
** ****** *** ******** **** ** close *** ** ********* ****** ** the *** ** **** **** (********) or *** ********* ** *** ***** quarter. **** ***** ***** **** **** a ********** **** *** ******** ** for ******* ********* *** * ****** new **** ** ****.
Comments (3)
UM
Undisclosed Manufacturer #1
Sep 18, 2023JH
John Honovich
Sep 18, 2023It's a bidding process so it depends on who is willing to pay the most / cleanest terms, etc.
Compare histroically:
Michael Votaw
Sep 20, 2023Hoping each group is aquired by a company that is willing to invest in the products, people and customers. There is a great opportunity there.