So, here's a thing that happens in M&A sometimes: you agree to buy something, and then later you agree to buy it for less money. That's essentially what Honeywell International Inc. (HON) did on Monday. The industrial giant announced it has entered into an amended agreement to acquire the Catalyst Technologies business from Johnson Matthey Plc (JMPLY). The twist? The price tag just got a lot lighter.
Remember back in May 2025 when Honeywell first announced this deal? They were going to pay 1.8 billion pounds, which was about $2.4 billion at the time. That valued the deal at roughly 11 times the business's projected 2025 EBITDA. Fast forward to now, and the total consideration has been adjusted down to 1.325 billion pounds, or approximately $1.79 billion. That's a reduction of about 475 million pounds, or roughly $640 million. Not exactly pocket change.
Why the haircut? The announcement didn't spell out specific reasons, but these things often involve re-evaluations of business performance, market conditions, or just good old-fashioned renegotiation as a deal drags on. And drag on it will. The companies have extended the "long stop" date—the deadline by which the deal must close—to July 21, 2026. There's even a provision to push that to August 21, 2026, if certain conditions are met. Honeywell now expects the deal to close by the end of August 2026, pending the usual regulatory approvals and other closing conditions.
The market's reaction was pretty clear on who was getting the better end of this new bargain. According to a Bloomberg report, Johnson Matthey's shares fell as much as 17% following the news, the stock's biggest drop since 2021. It was still trading around 14% lower later in the morning in London, knocking the company's market value down to about 3.3 billion pounds. Ouch.
For Honeywell, the strategic rationale remains the same. The plan is to integrate the Catalyst Technologies unit into Honeywell's Energy and Sustainability Solutions (ESS) segment. The company believes this will add some promising high-growth opportunities to its portfolio and help it realize "substantial additional cost efficiencies." In the meantime, Honeywell says it will continue its existing commercial collaborations with Johnson Matthey. And importantly for shareholders, Honeywell still expects the acquisition to boost its adjusted earnings per share in the first full year after it owns the business.
Let's talk about the stock for a minute. Honeywell shares were essentially flat in premarket trading Monday, inching up 0.01% to $244.00. From a technical perspective, the stock is showing some short-term weakness, trading 1.5% below its 20-day simple moving average and 2.3% below its 100-day simple moving average. Over the past year, though, shares are up nearly 15% and are trading closer to their 52-week highs than their lows.
The Relative Strength Index (RSI) sits at 44.45, which is considered neutral, while the MACD indicator is at 0.15, below its signal line of 0.22, suggesting some bearish pressure. So, the technical momentum looks mixed. Traders might watch key resistance at $245.00 and key support at $240.00.
Looking ahead, Honeywell is scheduled to provide its next financial update on April 28, 2026. The current consensus estimates are looking for earnings per share of $2.33 and revenue of $9.26 billion. Both figures are down from prior estimates of $2.51 EPS and $9.82 billion in revenue. The stock trades at a price-to-earnings ratio of 32.2x, which indicates a premium valuation.
Despite that premium and the near-term technical softness, Wall Street analysts are still generally bullish. The stock carries a consensus Buy rating with an average price target of $244.00. Recently, several major firms have even raised their targets: JP Morgan moved to Overweight with a $260.00 target, Citigroup reiterated a Buy with a $265.00 target, and RBC Capital maintained an Outperform rating with a $268.00 target—all of those moves happened on January 30.
So, to sum it up: Honeywell is still buying the same business, but it's paying about $640 million less for it and giving itself another year and a half to get the deal done. Johnson Matthey's shareholders are not thrilled. Honeywell's shareholders get a cheaper acquisition that's still expected to be earnings-accretive. And everyone gets to wait until late summer 2026 to see how it all turns out. That's the deal, amended.
