Key Points
- Johnson Controls International Plc is selling its residential and light commercial HVAC business to Bosch for a total consideration of $8.1 billion.
- Johnson Controls will receive $6.7 billion from the deal, which includes the company’s joint venture with Hitachi, in which the company holds a 60% stake.
- CEO George Oliver said the sale is part of Johnson Controls’ effort to become a simpler, higher-growth company.
Johnson Controls International Plc (JCI) is selling its residential and light commercial HVAC business to German-based engineering and technology firm Bosch for a total consideration of $8.1 billion.
The agreement covers Johnson Controls’ North American business and a global housing joint venture with Hitachi, which is 60% owned by Johnson Controls. Johnson Controls said it will receive about $6.7 billion in the deal.
Following Strategic Review of Non-Core Product Lines
The building products and systems provider said that with the agreement, its “portfolio will be substantially simplified with an enhanced strategic focus, in line with the Company’s goal of becoming a comprehensive solutions provider for commercial buildings.”
The company added that the move is “part of the Company’s previously announced strategic evaluation of non-core product lines.”
Chief executive George Oliver said the sale positions Johnson Controls as a simpler, higher-growth company. The sale is expected to close within the next 12 months.
Johnson Controls Raises Earnings Guidance
Additionally, Johnson Controls announced it anticipates adjusted earnings per share in the current quarter will be slightly higher than its previous guidance of $1.05 to $1.10. The company reported the results on July 31.
Johnson Controls shares fell 1.3% to $69.30 in recent trading. Despite the decline, the stock is up about 21% since the start of the year.
Trading View
