Skadden, Weil shepherd Honeywell’s $1.9bn CAES acquisition

Weil counsels seller Advent as Skadden acts for longtime client Honeywell in deal for defence tech company

Skadden Arps Slate Meagher & Flom is repping Honeywell for its $1.9bn acquisition of defence technology company CAES Systems from Advent International, which is being counselled by Weil Gotshal & Manges.

The all-cash deal comes amid surging demand for the electronics CAES develops, such as antenna systems and communication networks for aerospace and defence companies, in response to conflicts including Russia-Ukraine and Israel-Hamas, according to Reuters. 

It forms part of Honeywell’s focus on automation, energy transition and the future of aviation to drive business growth, a strategy brought in by chief executive Vimal Kapur after he took over leadership of the US manufacturing giant in June 2023. 

The Skadden team advising Honeywell on the deal was led by Allison Schneirov, a global head of the firm’s transactions practice, and M&A partner Alexandra McCormack. Schneirov and McCormack also led a Skadden team that advised Honeywell on its $5bn acquisition of Carrier Global Corporation’s Global Access Solutions business, which was completed earlier this month. 

The CAES acquisition is Honeywell’s third this year; in March the company also said it would acquire Italian aircraft components manufacturer Civitanavi Systems, with Bird & Bird called in to advise it on the deal. 

Meantime, Weil is a longtime adviser to Advent, including in its £4bn take-private acquisition of UK-based defence company Cobham in early 2020 that included its electronics unit, CAES (then Cobham Advanced Electronic Solutions). The following year the buyout firm established CAES as a standalone entity.

This time the Weil team advising Advent was led by private equity M&A partner Jonathan Wood, co-managing partner of the firm’s 230-lawyer London office, and Boston-based private equity partner Jakub Wronski. 

Both men have advised Advent and its portfolio companies on numerous past deals – Wood acted in the sale of Cobham’s aerial refuelling wing, Cobham Mission Systems, to Eaton for $2.8bn in 2021, while Wronski acted in the roughly $2bn sale of CAES’s space business to Veritas Capital in 2022. 

CAES’s sale to Honeywell is expected to close in the second half of 2024 and add to Honeywell’s adjusted earnings per share in the first full year of ownership.

CAES is headquartered in Arlington, Virginia and has 13 facilities in North America, including highly automated manufacturing facilities with fully automated test and tuning processes, Honeywell said. The acquisition will add approximately 2,200 employees and a bench of radio frequency engineering talent. 

“This acquisition positions Honeywell at the forefront of the defence industry’s most dynamic sectors and sets the tempo for continued growth across our aerospace business,” chief executive Kapur said. “With the integration of CAES’s solutions and capabilities, we will fortify our existing defence offerings, while also expanding our capabilities in pivotal areas like radio frequency, radar and sensing technologies.”

Skadden led LSEG’s global M&A legal advisor rankings by deal value in the opening three months of the year as overall deal values rose by more than a third compared to the first quarter of 2023, to nearly $800bn. Skadden acted on 45 deals worth $150bn in the first quarter; meantime Weil’s work on 34 deals worth just shy of $30bn saw it place 19th in the rankings. The firms placed sixth and 20th respectively in the overall rankings for 2023, when global M&A hit a 10-year low, working on deals worth $303bn and $119bn.

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