By RTT News,
January 07, 2014, 08:10:00 AM EDT
(RTTNews.com) - Diversified technology firm Honeywell ( HON ) Tuesday said it has reached a definitive agreement to sell its Friction Materials business unit to Federal Mogul Corp. ( FDML ) for about $155 million. The transaction is expected to close in the second half of 2014.
Honeywell Friction Materials is a manufacturer of disc brake pads and braking system components for original equipment manufacturers and the aftermarket covering passenger car, light truck, commercial vehicle, railway, and other industrial applications.
The transaction is expected to generate an after tax loss of $0.04 per share, which will be recognized in the fourth quarter of 2013. However, the loss is not expected to affect Honeywell's fourth quarter 2013 or full year 2014 financial outlook.
Commenting on the sale, Honeywell CEO Dave Cote said, "While the business is much stronger today, it does not fit with Honeywell's core differentiated technologies focus and long-term growth plans. Federal Mogul's strong automotive components business is a better strategic fit for Friction Materials' continued growth over the long-term."
Honeywell plans to continue to operate its friction business as usual with no planned changes in staffing, or production through the closing of the transaction.
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