Honeywell has agreed to acquire industrial gases company Air Products’ liquefied natural gas (LNG) process technology and equipment business in an all-cash deal worth $1.81bn.

Headquartered in Pennsylvania, US, Air Products’ LNG business unit encompasses an extensive portfolio that includes in-house design and production of coil-wound heat exchangers (CWHE) and associated equipment.

Honeywell said that CWHEs offer the highest throughput of natural gas in a single exchanger with a small footprint.

Air Products‘ LNG unit has a 390,000ft2 manufacturing facility in Port Manatee, Florida, where all sizes of CWHEs are manufactured. It employs around 475 people.

Air Products chairman, president and CEO Seifi Ghasemi said: “The decision to divest our LNG heat exchanger technology and equipment business reflects Air Products’ continued focus on its two-pillar strategy — to grow our core industrial gas business and related technology and equipment, and to be a first-mover delivering clean hydrogen at scale to decarbonise industrial and heavy-duty transportation sectors.”

Through the acquisition, Honeywell aims to provide customers with an extensive solution for managing their energy transformation journey.

By leveraging digital automation technologies unified under the Honeywell Forge and Experion platforms, the new offering will include natural gas pre-treatment and state-of-the-art liquefaction.

The full-service solution is expected to facilitate efficient and optimised management of natural gas assets to deliver better value and support.

Honeywell currently delivers a pre-treatment solution serving LNG customers across the globe.

Honeywel chairman and CEO Vimal Kapur said: “This highly complementary acquisition will further strengthen our energy transition portfolio, and Air Products’ CWHE technology will immediately expand our installed base – creating new opportunities to compound growth in aftermarket services and digitalisation through our Honeywell Forge platform.”

Subject to customary conditions, including receipt of regulatory approvals, the transaction is anticipated to be completed before the end of 2024.

The deal marks Honeywell’s fourth acquisition this year, as it aims to buy high-return businesses that will drive future growth across its portfolio.