FTSE 100 firm Smiths Group plc has agreed a £1.3 billion disposal.
US electronics firm Molex, part of industrial conglomerate Koch, has agreed the mammoth deal for the London-headquartered company’s Smiths Interconnect subsidiary.
The cash deal – expected to complete in the second half of fiscal year 2026 – represents 15.1x headline EBITDA of £86.1m for the fiscal year 2025.
Smiths said it was a notable step forward in its strategy to become a more focused industrial engineering company. It had come under pressure from US activist investor Engine Capital to break up the business. A demerger or sale of Smiths Detection, which makes baggage-screening scanners used in airports, will now be explored.
Smiths Interconnect is a provider of high-reliability connectivity products and solutions serving the aerospace and defense, medical, semiconductor test and industrial markets.
It has 21 sales, R&D and manufacturing locations across 12 countries, including the United States, Canada, Mexico, Costa Rica, France, Germany, Italy, the United Kingdom, Tunisia, India, China and Singapore, and employs more than 2,500 people.
The unit reported revenue of £421m in the fiscal year 2025, accounting for about 13% of the group’s total revenue.
Smiths Group plc’s share price has risen almost 40% in the year to-date.
Smiths chief executive Roland Carter said: “This is an important step as we deliver on our commitment to focus Smiths and unlock the inherent value in our business.
“Today’s announcement, and our recent results, show we are delivering on our strategy with pace and purpose and I am confident that we will continue to do so as we further focus our business as a high-performing industrial engineering company.
“We thank our Smiths Interconnect colleagues for their significant contribution to the Smiths Group over many years and wish them every success as they transition to their new owner, Molex, who is well placed to support their future growth.”