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MORRIS TOWNSHIP, N.J. -- Honeywell (NYSE: HON - News) announced
that it has agreed to sell its U.S. nylon carpet fibers business to Shaw Industries
Group, Inc., a subsidiary of Berkshire Hathaway, Inc. Honeywell
and Shaw also agreed to a long-term supply agreement for Honeywell to supply Shaw
with caprolactam and nylon resin, two intermediate chemicals used in the production
of nylon fibers for carpeting and other applications. Honeywell's
Nylon business is comprised of two operations: fibers and intermediates. Honeywell
will retain the intermediates business, which manufactures caprolactam, Aegis®
nylon resins for various fiber and plastic applications, Sulf-N® ammonium
sulfate fertilizer and other chemicals. Financial terms
of the agreement were not disclosed. The transaction, which is subject to Hart-Scott-Rodino
regulatory review, is expected to close in the fourth quarter of 2005. "Once
completed, this divestiture will represent another major step in Specialty Materials'
transformation," said Nance Dicciani, president and CEO of Honeywell Specialty
Materials. "Divestiture of the non-core nylon carpet fiber business will
allow us to focus on the future and our core growth portfolio, while building
on our track record of financial achievement over the past three years." Under
terms of the transaction, Honeywell will sell its nylon fiber manufacturing operations
in Anderson, Clemson and Columbia, S.C., to Shaw Industries, which will also acquire
the Zeftron® nylon and Anso® nylon brand names. Shaw will also acquire
Honeywell's 50 percent stake in Evergreen Nylon Recycling, based in Augusta, Ga. These
four operations represent approximately 90 percent of Honeywell's nylon fiber
capacity. Honeywell's nylon fiber operations in Shanghai, China, and Arnprior,
Canada, and its textile operations in Anderson, S.C., are not part of the transaction. Honeywell's
Nylon business was expected to post revenues of approximately $1.2 billion in
2005. After the divestiture and with the supply agreement, the remaining business
is expected to have annual revenues of approximately $900 million. Shaw
Industries is based in Dalton, Ga., and produces and sells carpet, rugs, ceramic,
hardwood, and laminate flooring for residential and commercial applications throughout
the world. Earlier this year, Honeywell sold its U.S. industrial
wax operations to IGI International, Inc. and its Asian and European industrial
wax operations to Paramelt BV. Last year, Honeywell divested its Performance Fibers
business. The divestitures are part of Honeywell Specialty Materials' plan to
focus investment on select core businesses built on growth platform technologies
including fluorines, advanced fibers and composites, and electronic materials. Honeywell
International is a $26 billion diversified technology and manufacturing leader,
serving customers worldwide with aerospace products and services; control technologies
for buildings, homes and industry; automotive products; turbochargers; and specialty
materials. Based in Morris Township, N.J., Honeywell's shares are traded on the
New York, London, Chicago and Pacific Stock Exchanges. It is one of the 30 stocks
that make up the Dow Jones Industrial Average and is also a component of the Standard
& Poor's 500 Index. Honeywell Specialty Materials,
based in Morristown, N.J., is a global leader in providing customers with high-performance
specialty materials, including fluorocarbons, specialty films and additives, advanced
fibers and composites, customized research chemicals, and electronic materials
and chemicals. This release contains forward-looking statements
as defined in Section 21E of the Securities Exchange Act of 1934, including statements
about future business operations, financial performance and market conditions.
Such forward-looking statements involve risks and uncertainties inherent in business
forecasts as further described in our filings under the Securities Exchange Act. Source:
Honeywell |