Chart Industries to acquire Howden

The purchase price is US$4.4 billion and will be funded through a combination of cash and shares of a newly created class of preferred stock. The acquisition is subject to the receipt of certain regulatory approvals and the satisfaction of other customary closing conditions and is expected to close in the first half of 2023.

The acquisition will result in estimated combined revenue of approximately US$3.4 billion based on the trailing 12 months as of 31 August 2022. The purchase price represents 12.9x Howden’s adjusted EBITDA for the 12 months ended 31 August 2022, or 8.5x including estimated annual cost synergies of US$175 million to be achieved in the first 12 months of ownership (US$250 million annual cost synergies by year three).

In addition to cost opportunities, Chart has identified significant commercial synergies that are expected to reach US$350 million annually by year three.

“The combination of Chart and Howden furthers our global leadership position in highly engineered process technologies and products serving the Nexus of Clean^™ – clean power, clean water, clean food and clean industrials. The offerings of Chart and Howden are highly complementary, bringing multiple cost synergies, commercial synergies and efficiencies in the first year, along with significant aftermarket, service and repair exposure, which lifts the margin profile of the combined business, adds resiliency and broadens our end markets,” said Jill Evanko, Chart’s CEO and President. “The two companies have shared customer-centric values and are both very committed to innovation which will result in expanded reach into global markets and acceleration in product development.”

“I am thrilled that Chart has agreed to acquire Howden. This acquisition will provide benefits for both businesses, as well as our team members and customers. Over the past years, Howden and Chart have worked together on various projects, and through these activities we have witnessed first-hand the potential synergies of this combination, as well as the aligned values and cultures of the two companies,” stated Ross Shuster, CEO of Howden. “Our complementary offerings will enable the combined organisation to offer customers an even broader set of innovations, solutions and services.”

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/10112022/chart-industries-to-acquire-howden/