Federal-Mogul to acquire Honeywell's brake friction business for $155 million
Federal-Mogul Corp. has agreed to acquire Honeywell International Inc.'s automotive and industrial brake friction business for about $155 million.
The Honeywell unit makes disc brake pads and braking system components for automakers and the aftermarket.
Honeywell's friction materials business, of Glinde, Germany, employs more than 2,000 people worldwide. Federal-Mogul said it also will take control of Honeywell plants in China and Romania.
The friction materials business is expected to run as usual with no planned staffing changes or interruption in production while the deal is finalized, Honeywell said in a statement on Tuesday.
Honeywell said the deal is expected to generate an after-tax loss of 4 cents per share that will be recorded in the company's fourth quarter of 2013. The loss is not expected to affect the company's financial outlook for 2014.
The deal is expected to close in the second half of 2014.
Federal-Mogul shares have been rising on the news, gaining 9 percent to close at $22.97 today.
Federal-Mogul, of suburban Detroit, ranks No. 50 on the Automotive News list of the top 100 global suppliers with an estimated $4.3 billion in sales to automakers in 2012. It operates in 22 countries and is controlled by longtime Wall Street investor Carl Icahn.
Honeywell, of Morristown, N.J., ranks No. 60 on the Automotive News list of the top 100 global suppliers with worldwide parts sales to automakers of $3.08 billion in 2012.
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