General Electric to buy Honeywell for $45 billion in stock

General Electric Co. agreed Oct. 22, to buy Honeywell International Inc. for $45 billion in stock and assumed debt. Honeywell’s shareholders will receive 1.055 shares of GE stock for each share of Honeywell stock. The boards of both companies have already approved GE’s planned acquisition. Pending regulatory approval in the U.S. and Europe, the purchase is expected to close early in 2001. This announcement followed an Oct. 20 announcement that Honeywell was merging with United Technologies Corp. (UTC, Hartford, Conn.), which fell through later that day. UTC had offered $40.3 billion for Honeywell and was expected to assume Honeywell’s name, which Allied Signal did when it bought the old Honeywell for approximately $14 billion in stock in 4Q1999. GE states it will use the "GE-Honeywell" brand name in some key product lines. Though GE and Honeywell have both complementary and overlapping businesses, it’s not yet known how many of the new firm’s business units or 460,000 employees will be affected.

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