Honeywell to acquire RMG Regel+Messtechnik with its natural gas measurement and control technology

$400 million purchase aims at expanding Honeywell’s solution portfolio and market penetration in clean-energy industries.

06/30/2009


Brussels– Honeywell announced that it has signed a definitive agreement valued at approximately $400 million to acquire the RMG Group (RMG Regel + Messtechnik GmbH and all of its subsidiaries) a Kassel, Germany-based global provider Honeywell Process Solutions , which is part of Honeywell’s Automation and Control Solutions business group. The transaction is subject to regulatory approvals.

“The technologies associated with natural gas are somewhat specialized,” says Norm Gilsdorf, president of Honeywell Process Solutions. “You’re dealing with a high pressure environment and a lot of measurement and control issues as gas is transferred across different systems and borders. RMG is a leader in that field, so it’s a nice fit for us. We have more strength upstream in natural gas production and the compressor side, so this gives us strength in the network side.”

Founded in 1931, RMG has concentrated on developing products for natural gas control, measurement, and analysis, primarily working from the point of consumption and up the supply chain. This includes flow metering technology, regulating products, and safety devices for oil and gas companies. RMG has estimated 2009 sales to be $290 million.

“Global demand for clean energy sources like natural gas, is growing and RMG is an established solution provider in the industry,” says Gilsdorf. “RMG’s technology complements our industrial platform and will ultimately enable us to provide our existing customers, as well as new customers, with broader solutions that span the entire gas supply chain. This is an excellent fit for our business and will strengthen Honeywell’s global presence in the clean energy industry.”

The acquisition will build Honeywell’s presence particularly in the areas of natural gas transportation, storage, distribution and industrial consumption. As Gilsdorf describes it, “RMG started at the consumer end of the gas stream and has worked its way up. We bring the other layers, we bring the upstream, and we bring our global presence. And our partners UOP bring a lot of gas separation and processing technology that’s used upstream. We’re ready to be at the table and talking about better solutions for customers.”

Honeywell feels that RMG aligns strongly with its field instrumentation and control solutions. For example, RMG’s gas flowmeters and regulating devices complement Honeywell’s pressure and temperature transmitters, as well as liquid natural gas (LNG) level gauges.

“Our business, customers and employees will benefit from becoming part of Honeywell,” says Dr. Henning Bähren, chief executive officer of RMG Group. “RMG is already a global leader and this acquisition will give us access to broader growth opportunities and distribution channels, and gives us the ability to expand our product offerings in a world with ever-increasing demand for clean energy. Honeywell’s industrial offerings will allow us to create enhanced automation and control solutions for all of our customers worldwide.”

Gilsdorf sees many similarities to Honeywell’s acquisition of Enraf two years ago, which it bought to get specialized devices for the oil industry. “Enraf brought us products for the whole liquid side,” he says. “That’s exactly what we have here. We see them fitting in organizationally very similarly to the way Enraf did with the same kind of synergies.”

Honeywell expects that it can extend RMG’s penetration into industrial applications for controlling gas-fired furnaces in chemical plants and refineries.

- Peter Welander, process industries editor
Control Engineering news desk
More about process control .





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