Honeywell has agreed to acquire CAES Systems Holdings LLC (CAES) from private equity firm Advent International for approximately US$1.9 billion in an all-cash transaction. This represents approximately 14-times the estimated 2024 EBITDA on a tax-adjusted basis.
This acquisition will enhance Honeywell's defence technology solutions across land, sea, air, and space, including new electromagnetic defence solutions for end-to-end radio frequency (RF) signal management. With CAES' scalable offerings and Honeywell's current defence and space portfolio, the combined company will grow Honeywell's established production and upgrade positions on critical platforms including the F-35, EA-18G, AMRAAM, and GMLRS, while also introducing offerings on new platforms like Navy Radar (SPY-6) and UAS and C-UAS technologies. Based on current and anticipated demand, these programmes are expected to grow significantly in the years to come, creating a favourable tailwind for revenue growth of Honeywell's Aerospace Technologies business.
“This acquisition further positions Honeywell at the forefront of the defence industry's most dynamic sectors and sets the tempo for continued growth across our aerospace business,” said Vimal Kapur, Chairman and CEO of Honeywell. “With the integration of CAES' solutions and capabilities, we will fortify our existing defence offerings, while also expanding our capabilities in pivotal areas like RF, radar and sensing technologies, to ensure a market-leading position in areas that are critical for global security.”
Headquartered in Arlington, Virginia, CAES (formerly known as Cobham Advanced Electronic Solutions) has 13 facilities in North America, including highly automated manufacturing facilities with fully automated test and tuning processes. The acquisition will add approximately 2,200 employees and a deep bench of RF engineering talent.
“The combination of our talented teams will diversify and deepen our expertise and specialised capabilities that enable us to scale current offerings and innovate new ones across critical military platforms,” said Honeywell Aerospace Technologies President and CEO Jim Currier. “CAES' trusted position with top U.S. defence customers strengthens our existing relationships as we shape the future of the defence industry together.”
Looking ahead, Honeywell sees attractive opportunities to expand the combined solutions internationally, capitalising on accretive growth spaces with select defence customers.
