Federal-Mogul Corp. has reached an agreement to acquire the automotive and industrial brake friction business of Honeywell International Inc. for around $155 million. Federal-Mogul will also take control of Honeywell site in China and Romania. The friction materials business, based in Glinde, Germany, is expected to operate with no planned staffing changes or interruption in production while the agreement is finalized, Honeywell said in a statement.
The business employs over 2,000 people around the world. According to Honeywell, the agreement might result to an after-tax loss of 4 cents per share that will be recorded in the fourth quarter of 2013, but would not affect its financial outlook for 2014.
The agreement, which is expected to be completed in the second half of 2014, has caused Federal-Mogul shares to rise. Federal-Mogul is No. 50 on the Automotive News list of the top 100 global suppliers, with an estimated $4.3 billion in sales to carmakers in 2012.
The Carl Icahn-controlled supplier has operations in countries. Honeywell, meanwhile, is No. 60 on the Automotive News list of the top 100 global suppliers, with global parts sales of $3.08 billion in 2012.