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Johnson Controls considering options for power solutions unit
Posted on Tuesday, 13 March 2018 14:42
New York-listed diversified technology firm Johnson Controls is looking into strategic alternatives for its power solutions division. The company said it is taking the step in order to maximise value for shareholders, while improving operational execution, strengthening its existing portfolio and enhancing productivity. Chief executive George Oliver said the power solutions unit is being considered for sale given the differing dynamics with the firm’s other platform, namely its integrated buildings technology and solutions division. He added that the decision is indicative of Johnson Controls’ desire to invest more in its world-leading position in the latter segment, as well as in heating, ventilation and air conditioning, and fire and security products. The company believes its strategic review of the business will be completed at some point in the next few months and noted that its eventual decision will still require approval from the board. No further statement will be made on the matter until a conclusion has been reached and there can be no guarantee as to the timing of the potential divestment. According to Zephyr, the M&A database published by Bureau van Dijk, Johnson Controls’ most recent asset sale completed in October 2017, when it offloaded North Carolina-based respiratory and protective equipment and safety devices maker Scott Technologies to 3M for USD 2.00 billion. Other assets previously divested include its integrated demand resources business, which was picked up by CPower in May 2016. No financial details of the transaction were disclosed. The power solutions division posted revenue of USD 7.30 billion in fiscal 2017, while earnings before interest, taxes, depreciation and amortisation for the year totalled USD 1.60 billion. Johnson Controls’ customer base spans in excess of 150 countries and the firm employs some 120,000 people. Its output includes intelligent buildings, efficient energy solutions, integrated infrastructure and next generation transportation systems. © Zephus Ltd