Investment firm Permira is selling business for $1.5 billion
By JOSHUA JAMERSON and Robbie Whelan
A plant within Honeywell’s automation and control solutions division in Golden Valley, Minn. The industrial conglomerate is adding to its supply-chain portfolio with the purchase of Intelligrated. PHOTO: ERIC MILLER/REUTERS
Updated July 4, 2016 4:24 p.m. ET
Industrial conglomerate Honeywell International Inc. said on Friday it has agreed to acquire Intelligrated, a privately held supplier of warehouse automation systems, for $1.5 billion in cash.
Intelligrated, which Honeywell is buying from global investment firm Permira, includes as its customers United Parcel Service Inc., Amazon.com Inc. and Nordstrom Inc.
Manufacturers of warehouse automation have emerged as hot takeover targets in recent years, as the growth of online shopping has sparked an arms race among retailers to cut costs and modernize their distribution centers.
“E-commerce continues to grow at an unprecedented rate and customer demands for faster delivery times have created a need for warehouse, logistics and fulfillment solutions that can increase productivity and lower costs for our customers,” said Alex Ismail, chief executive of Honeywell Automation and Control Solutions.
In 2012, Amazon paid $775 million for Kiva Systems Inc., which designs and builds robots that transport entire shelves of products from one part of a warehouse to another. The deal was one of the online retailer’s largest individual acquisitions to date, and Kiva’s robots have since been integrated exclusively into Amazon’s warehouses.
Two other recent deals have brought logistics-technology firms wider attention.
In May, Chinese appliance maker Midea Group Co. offered more than $5 billion for Germany’s Kuka AG, which specializes in building lightweight robots that can be used in factories and warehouses. The deal has yet to be completed. And in June, German forklift manufacturer Kion Goup AG announced it had struck a $2.1 billion deal for Dematic Corp., an American company that designs supply-chain software and equipment to make warehouses more efficient.
Intelligrated, based in Mason, Ohio, was founded in 2001 and currently employs more than 3,100 people in the U.S., Canada, Mexico, Brazil and China. Permira paid about $500 million to acquire the company in 2012.
Honeywell, which put Intelligrated’s annual sales at about $900 million, said the transaction is expected to close by the end of the third quarter. The industrial conglomerate said earlier this week that Chief Executive Dave Cote would step down at the end of March, capping a 14-year tenure.
Write to Joshua Jamerson at [email protected] and Robbie Whelan at [email protected]
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