Bosch Acquires Johnson Controls' HVAC Business in $8.1 Billion Deal

Bosch acquires residential and light commercial HVAC business from Johnson Controls and Hitachi

Bosch chairman Stefan Hartung: "Biggest transaction in Bosch history and important milestone in the implementation of our corporate strategy for 2030." Bosch deputy chairman Christian Fischer: "Acquired entities will strengthen Home Comfort in an extremely attractive segment, and will become part of Bosch core business." Expansion of presence in the U.S. and Asia. Innovative, energy-efficient solutions for the move to alternative energy and for helping to mitigate global warming. Bosch Home Comfort Group sales revenue to increase from roughly 5 billion euros to 9 billion euros. Integrated unit will then have workforce of more than 26,000 and complementary portfolio at the interface between heating and cooling. Stuttgart, Germany - Bosch, the supplier of technology and services, is continuing its growth course with a strategic acquisition. For its Energy and Building Technology business sector, the Bosch Group plans to take over the global HVAC solutions business for residential and light commercial buildings from Johnson Controls. As part of this transaction, Bosch also intends to acquire 100 percent of the Johnson Controls-Hitachi Air Conditioning (JCH) joint venture, including Hitachi's 40 percent stake. The Bosch shareholders and supervisory board have approved the transaction. Binding agreements on the acquisitions were signed by the parties involved today. The acquisition is subject to approvals from the antitrust authorities. The purchase price for the acquired businesses is 8 billion dollars (7.4 billion euros). The acquisition is expected to be closed in approximately 12 months. "As the biggest acquisition in Bosch history, this is an important milestone in the systematic implementation of our strategy for 2030. We are dynamically pushing ahead with the strong development of Bosch, and will achieve a globally leading position in the promising HVAC market with this acquisition," says Stefan Hartung, chairman of the board of management of Robert Bosch GmbH. "In taking this step, moreover, we will strengthen our presence in the U.S. and Asia and achieve a better balance among our business sectors. This is also part of our strategy. In this way, we will open up further growth opportunities and put the company as a whole on a firmer footing." Together with JCH, the businesses Bosch intends to acquire generated sales revenue totaling roughly 4 billion euros in 2023, and employ some 12,000 people worldwide. The transaction includes 16 manufacturing sites and 12 engineering locations in more than 30 countries. The product portfolio covers the entire spectrum of HVAC solutions for residential and light commercial buildings, and includes well-known brands such as York and Coleman in the U.S. and Hitachi in Asia, for which Bosch will be granted a long-term license. Christian Fischer, the deputy chairman of the board of management of Robert Bosch GmbH who is responsible for the Bosch Group's strategic growth initiatives, and thus for this planned acquisition, adds: "With this acquisition, Bosch will accelerate its growth and nearly double its sales revenue in the HVAC market to roughly 9 billion euros. Together with our future colleagues, we want to seize the huge opportunities offered by the market for the further growth of this new unit." The company expects the global HVAC market to grow 40 percent by 2030, driven by technological progress, the fight against climate change, and new regulations. "The acquired businesses will become part of the Bosch core business - and this will benefit customers, installation partners, and associates," Fischer adds. "We have proved several times in the past that we can successfully integrate brands, take them forward through investments, and strengthen them." In the words of George Oliver, CEO of Johnson Controls: "Our leading residential and light commercial business and its world-class team perfectly complement the Bosch portfolio. We are confident that under Bosch's leadership the business will continue to excel and deliver innovative products and service to its customers. We look forward to seeing their continued success." Jun Abe, executive officer and executive vice president at Hitachi, and executive officer and general manager of the Hitachi Connective Industries division, says: "The new partnership with Bosch to establish a global air-conditioning business is an important step. The market is dynamic, and is flourishing. I firmly believe that a global supplier such as Bosch, with its strong European presence and many years of experience in the heating business, is the optimum partner for further expanding the global air-conditioning business of the longstanding Hitachi brand." Innovative, energy-efficient solutions for mitigating global warming and the move to alternative energy The current transformation in technologies and market conditions in the field of HVAC solutions opens up huge opportunities for supplying innovative and energy-efficient solutions for mitigating global warming and the move to alternative energy. Heating technology is moving away from fossil fuels such as oil and gas toward heat pumps and heat pump-hybrid solutions. At the same time, air-conditioning technology is growing in importance both in Europe and worldwide. Frank Meyer, the Bosch management board member responsible for the Energy and Building Technology business sector, and thus also for the Bosch Home Comfort Group and the integration of the new unit, says: "It is Bosch's aim to play an active part in shaping the innovative and growing market for energy and building technology, and to occupy a globally leading position. With this acquisition, we are improving our position, especially in air conditioning. In addition, we will be able to globally expand our heat-pump business and achieve greater economies of scale. With our technology and our products, we can work together to make a bigger contribution to energy efficiency and to more comfort and a better quality of life for many people in light of global warming. That's 'Invented for life' in its truest sense." Complementary portfolio, established brands, and a strong team Bosch intends to integrate the acquired businesses into the Home Comfort Group. The 14,600 associates of the existing Bosch Home Comfort Group generated sales of roughly 5 billion euros in 2023. Home Comfort is excellently positioned in the major segments of the heating market, of the heat-pump market, and of the market for heat pump-hybrid solutions, which comprise a heat pump and a fossil fuel-fired boiler for peak loads. Following the transaction, the new unit will have a workforce of more than 26,000 and be able to benefit considerably from economies of scale and a complementary portfolio at the interface between heating and cooling. Jan Brockmann, president of the Bosch Home Comfort Group, says: "With our successful heating technology in Europe, we already have a strong team and a sound foundation. Now is the right time for a bold step toward a global presence. Demand for air-conditioning solutions is growing especially fast." In the U.S., for example, Bosch expects to see more than 50 percent growth by the end of the decade, and in Europe as well, strong growth of approximately 30 percent is forecast up to 2030. Together, we will be able to build on strong, well-established brands. We are looking forward to shaping the future of the Bosch Home Comfort Group with our future colleagues and their innovations and ideas," Brockmann adds. The HVAC business Bosch plans to acquire from Johnson Controls has an especially strong presence in the United States and Asia. In the United States, its portfolio focuses on ducted solutions in which air passes from a central source through ducts in order to heat or cool all rooms at the same time. In Asia, it especially sells ductless solutions, where interior units in each room can heat or cool individually, as well as modern air-conditioning systems based on variable refrigerant flow (VRF) systems. This technology is used in commercial applications ranging from light commercial premises such as retail stores to large projects such as hotels and hospitals. The portfolio in these regions is supplemented by efficient air-water heat pumps, which Johnson Controls offers above all in Europe. Contact persons for press inquiries: Sven Kahn, E-mail: [email protected] Jörn Ebberg E-mail: [email protected] Athanassios Kaliudis, Phone: 0711/811-7494, E-mail: [email protected] Contact persons for trade media press inquiries: Thomas Pelizaeus E-mail: [email protected] Anne Kaletsch E-mail: [email protected] About Bosch Group The Bosch Group is a leading global supplier of technology and services. It employs roughly 429,000 associates worldwide (as of December 31, 2023). The company generated sales of 91.6 billion euros in 2023. Its operations are divided into four business sectors: Mobility, Industrial Technology, Consumer Goods, and Energy and Building Technology. With its business activities, the company aims to use technology to help shape universal trends such as automation, electrification, digitalization, connectivity, and an orientation to sustainability. In this context, Bosch's broad diversification across regions and industries strengthens its innovativeness and robustness. Bosch uses its proven expertise in sensor technology, software, and services to offer customers cross-domain solutions from a single source. It also applies its expertise in connectivity and artificial intelligence in order to develop and manufacture user-friendly, sustainable products. With technology that is "Invented for life," Bosch wants to help improve quality of life and conserve natural resources. The Bosch Group comprises Robert Bosch GmbH and its roughly 470 subsidiary and regional companies in over 60 countries. Including sales and service partners, Bosch's global manufacturing, engineering, and sales network covers nearly every country in the world. Bosch's innovative strength is key to the company's further development. At 136 locations across the globe, Bosch employs some 90,000 associates in research and development, of which nearly 48,000 are software engineers. The company was set up in Stuttgart in 1886 by Robert Bosch (1861-1942) as "Workshop for Precision Mechanics and Electrical Engineering." The special ownership structure of Robert Bosch GmbH guarantees the entrepreneurial freedom of the Bosch Group, making it possible for the company to plan over the long term and to undertake significant upfront investments in the safeguarding of its future. Ninety-four percent of the share capital of Robert Bosch GmbH is held by Robert Bosch Stiftung GmbH, a charitable foundation. The remaining shares are held by Robert Bosch GmbH and by a corporation owned by the Bosch family. The majority of voting rights are held by Robert Bosch Industrietreuhand KG. It is entrusted with the task of safeguarding the company's long-term existence and in particular its financial independence - in line with the mission handed down in the will of the company's founder, Robert Bosch. Additional information is available online at www.bosch.com, www.iot.bosch.com, www.bosch- press.com.

Johnson Controls to Sell Residential and Light Commercial HVAC Businesses

Divestiture Advances Johnson Controls' Transformation into a Pure-Play Provider of Comprehensive Solutions for Commercial Buildings Transaction Valued At $8.1 Billion; JCI Consideration of $6.7 Billion Company Provides Preliminary 2024 Third Fiscal Quarter Earnings Update CORK, Ireland, July 23, 2024 /PRNewswire/ -- Johnson Controls International plc (NYSE: JCI) ("Johnson Controls" or the "Company"), the global leader in smart, healthy, safe and sustainable buildings, today announced it has reached a definitive agreement to sell its Residential and Light Commercial (R&LC) HVAC business in an all-cash transaction to the Bosch Group ("Bosch"). The transaction includes the North America Ducted business and global Residential joint venture with Hitachi, Ltd. ("Hitachi"), of which Johnson Controls owns 60% and Hitachi owns 40%. The total transaction is valued at $8.1 billion, and the Company's portion of the consideration is approximately $6.7 billion. As part of the transaction, Hitachi will retain certain ductless HVAC assets located in Shimizu, Japan. Following the close of the transaction, the Johnson Controls portfolio will be substantially simplified with enhanced strategic focus, aligned with the Company's objective to be a pure-play provider of comprehensive solutions for commercial buildings. Johnson Controls delivers a unique value proposition to customers, with its unmatched service and digital offerings that improve commercial building efficiency and reduce operational costs through its OpenBlue digital platform. The transaction represents a significant portion of the Company's previously announced strategic evaluation of non-core product lines. "We are pleased to have reached this pivotal milestone, which accelerates our transformation and positions Johnson Controls as a simpler, higher-growth company," said Johnson Controls Chairman and CEO George Oliver. "Johnson Controls is already benefiting from our transformation, which enables the unparalleled value proposition we provide to customers, and exposure to rapidly accelerating demand in the data center market and other key macro-economic tailwinds. We believe Johnson Controls is well-positioned for its next phase of growth to deliver enhanced, long-term value to shareholders." Johnson Controls' R&LC HVAC business, which is reported in the Global Products segment, engineers and manufactures ducted and ductless HVAC equipment and components globally for both residential and light commercial applications. In fiscal 2023, the R&LC HVAC business generated approximately $4.5 billion in consolidated revenue. Following the close of the transaction, the R&LC HVAC business will continue to provide residential and light commercial HVAC products under the York and Hitachi brands as well as Coleman, Champion, Luxaire, Guardian, Evcon, TempMaster and others. Christian Fischer, the deputy chairman of the board of management of Robert Bosch GmbH, said: "Johnson Controls' Residential & Light Commercial business has a consistent track record of excellence within the HVAC industry. Together with our future colleagues in the acquired business, we want to seize the huge opportunities offered by the market for the further growth of this new unit. The acquired entities will strengthen Bosch's Home Comfort Group in an extremely attractive segment and will become part of the Bosch core business." Transaction Details and Use of Proceeds The total consideration of approximately $6.7 billion to Johnson Controls includes approximately $4.6 billion for its North America Ducted business representing a multiple of 16.7x fiscal 2023 EBITDA and includes approximately $2.1 billion for its interest in the Johnson Controls-Hitachi Air Conditioning joint venture representing a multiple of 7.5x fiscal 2023 EBITDA. The transaction is expected to be accretive to profit margins adjusted for the impact of equity income. Net cash proceeds to Johnson Controls is expected to be approximately $5.0 billion after tax and transaction-related expenses. Consistent with its capital allocation policy, Johnson Controls expects to pay down debt to the extent required to retain its investment grade rating with the remaining proceeds available to be returned to shareholders. In conjunction with its ongoing transformation and this transaction, the Company has begun working on a comprehensive restructuring plan to minimize dilution post-close. The plan will utilize the work that has been done on functionalization over the past few quarters and leveraging a more streamlined business model focused on growing the Company's commercial buildings solutions franchise. The transaction is expected to close in approximately 12 months, subject to required regulatory approvals and other customary closing conditions. The Company expects to report the operating results of the R&LC HVAC business in discontinued operations beginning in the fourth fiscal quarter of 2024. Johnson Controls Fiscal Q3 2024 Earnings Update Johnson Controls expects 2024 third fiscal quarter adjusted earnings per share to be slightly ahead of its previously issued guidance range. The Company will report third fiscal quarter earnings on July 31, 2024. Advisors Centerview Partners and Citi served as financial advisors to Johnson Controls, Simpson Thacher served as legal advisor, and Joele Frank served as investor relations advisor. Preliminary Information Information concerning 2024 third fiscal quarter adjusted earnings per share presented in this press release is preliminary and may change. Johnson Controls financial closing procedures with respect to the preliminary financial information provided in this press release is not yet complete, and as a result, Johnson Controls final adjusted earnings per share may vary materially from the preliminary outlook included in this press release. Johnson Controls undertakes no obligation to update or supplement the information provided in this press release until Johnson Controls releases its financial statements for the three and nine months ended June 30, 2024. The preliminary adjusted earnings per share outlook included in this press release reflects Johnson Controls current estimates based on information available as of the date of this press release and has been prepared by management. This preliminary outlook should not be viewed as a substitute for full financial statements prepared in accordance with GAAP and is not necessarily indicative of the results to be achieved for any future periods. This preliminary outlook could be impacted by the effects of financial closing procedures, final adjustments, and other developments. Non-GAAP Financial Information This press release contains disclosures regarding adjusted earnings per share, which is a non-GAAP performance measure. Management believes that adjusted earnings per share is useful to investors in understanding period-over-period operating results and business trends of Johnson Controls. Management may also use adjusted earnings per share as a guide in forecasting, budgeting and long-term planning processes and for compensation purposes. Adjusted earnings per share should be considered in addition to, and not as replacements for, GAAP EPS the most comparable GAAP measure. Johnson Controls International plc Cautionary Statement Regarding Forward-Looking Statements Johnson Controls International plc has made statements in this press release that are forward-looking and therefore are subject to risks and uncertainties. All statements in this document other than statements of historical fact are, or could be, "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, these forward-looking statements can be identified by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "could," "seeks," "projects," "predicts," "intends," "plans," "estimates," "anticipates" or the negative version of these words or other comparable words. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements include, among other things, statements relating to the sale of the RL&C business, the satisfaction of closing conditions and the likelihood of consummation of the transaction, the expected time period to consummate the transaction, the anticipated benefits of the transaction, Johnson Controls strategy, the anticipated use of proceeds from the transaction, Johnson Controls restructuring plans and Johnson Controls future financial performance. Johnson Controls cautions that these statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond Johnson Controls' control, that could cause its actual results and performance, including the expected impact of the divestiture of the RL&C business, to differ materially from those expressed or implied by such forward-looking statements, include, among others, risks related to the ability to realize the anticipated benefits of the divestiture, including the possibility that expected benefits of portfolio simplification will not be realized or will not be realized within the expected time frame; delays in the closing of the transaction due to regulatory approvals or other closing conditions; unfavorable reaction to the divestiture by customers, competitors, suppliers and employees, disruption from the transaction, making it more difficult to maintain business and operational relationships; significant transaction costs; and other unknown liabilities. Other factors that could cause Johnson Controls' actual results to differ materially from those expressed include, among others, risks related to: Johnson Controls ability to develop or acquire new products and technologies that achieve market acceptance and meet applicable quality and regulatory requirements; the ability to manage general economic, business and capital market conditions, including the impact of recessions, economic downturns and global price inflation; fluctuations in the cost and availability of public and private financing for its customers; the ability to innovate and adapt to emerging technologies, ideas and trends in the marketplace, including the incorporation of technologies such as artificial intelligence; the ability to manage macroeconomic and geopolitical volatility, including shortages impacting the availability of raw materials and component products and the conflicts between Russia and Ukraine and Israel and Hamas; managing the risks and impacts of potential and actual security breaches, cyberattacks, privacy breaches or data breaches, including business, service, or operational disruptions, the unauthorized access to or disclosure of data, financial loss, reputational damage, increased response and remediation costs, legal, and regulatory proceedings or other unfavorable outcomes; Johnson Controls ability to remediate its material weakness; maintaining and improving the capacity, reliability and security of Johnson Controls enterprise information technology infrastructure; the ability to manage the lifecycle cybersecurity risk in the development, deployment and operation of Johnson Controls digital platforms and services; changes to laws or policies governing foreign trade, including economic sanctions, tariffs, foreign exchange and capital controls, import/export controls or other trade restrictions; fluctuations in currency exchange rates; changes or uncertainty in laws, regulations, rates, policies, or interpretations that impact Johnson Controls business operations or tax status; the ability to adapt to global climate change, climate change regulation and successfully meet Johnson Controls public sustainability commitments; risks and uncertainties related to the settlement with a nationwide class of public water systems concerning the use of AFFF; the outcome of litigation and governmental proceedings; the risk of infringement or expiration of intellectual property rights; Johnson Controls ability to manage disruptions caused by catastrophic or geopolitical events, such as natural disasters, armed conflict, political change, climate change, pandemics and outbreaks of contagious diseases and other adverse public health developments; the ability of Johnson Controls to drive organizational improvement; any delay or inability of Johnson Controls to realize the expected benefits and synergies of recent portfolio transactions; the ability to hire and retain senior management and other key personnel; the tax treatment of recent portfolio transactions; significant transaction costs and/or unknown liabilities associated with such transactions; labor shortages, work stoppages, union negotiations, labor disputes and other matters associated with the labor force; and the cancellation of or changes to commercial arrangements. Investors are therefore cautioned not to place undue resilience on any forward- looking statements. A detailed discussion of risks related to Johnson Controls business is included in the section entitled "Risk Factors" in Johnson Controls Annual Report on Form 10-K for the 2023 fiscal year filed with the SEC, which is available at www.sec.gov and www.johnsoncontrols.com under the "Investors" tab. Shareholders, potential investors and others should consider these factors in evaluating the forward-looking statements and should not place undue reliance on such statements. The forward-looking statements included in this press release are made only as of the date of this document, unless otherwise specified, and, except as required by law, Johnson Controls assumes no obligation, and disclaims any obligation, to update such statements to reflect events or circumstances occurring after the date of this press release. About Johnson Controls At Johnson Controls (NYSE: JCI), we transform the environments where people live, work, learn and play. As the global leader in smart, healthy and sustainable buildings, our mission is to reimagine the performance of buildings to serve people, places and the planet. Building on a proud history of nearly 140 years of innovation, we deliver the blueprint of the future for industries such as healthcare, schools, data centers, airports, stadiums, manufacturing and beyond through OpenBlue, our comprehensive digital offering. Today, with a global team of 100,000 experts in more than 150 countries, Johnson Controls offers the world's largest portfolio of building technology and software as well as service solutions from some of the most trusted names in the industry. The Bosch Group is a leading global supplier of technology and services. It employs roughly 429,000 associates worldwide (as of December 31, 2023). The company generated sales of 91.6 billion euros in 2023. Its business operations are divided into four business sectors: Mobility, Industrial Technology, Consumer Goods, and Energy and Building Technology. Through its business operations, the company wants to help give technological shape to universal trends such as automation, electrification, digitalization, and connectivity, as well as an orientation to sustainability. Bosch's broad diversification across regions and industries strengthens its innovativeness and robustness. Bosch uses its proven expertise in sensor technology, software, and services to offer customers cross-domain solutions from a single source. It also applies its expertise in connectivity and artificial intelligence in order to develop and manufacture user-friendly, sustainable products. With technology that is "Invented for life," Bosch wants to help improve quality of life and conserve natural resources. The Bosch Group comprises Robert Bosch GmbH and its roughly 470 subsidiary and regional companies in over 60 countries. Including sales and service partners, Bosch's global manufacturing, engineering, and sales network covers nearly every country in the world. Bosch's innovative strength is key to the company's further development. At 136 locations across the globe, Bosch employs some 90,000 associates in research and development, of which nearly 48,000 are software engineers. About Hitachi, Ltd.* Hitachi drives Social Innovation Business, creating a sustainable society through the use of data and technology. We solve customers' and society's challenges with Lumada solutions leveraging IT, OT (Operational Technology) and products. Hitachi operates under the 3 business sectors of "Digital Systems & Services" - supporting our customers' digital transformation; "Green Energy & Mobility" - contributing to a decarbonized society through energy and railway systems, and "Connective Industries" - connecting products through digital technology to provide solutions in various industries. Driven by Digital, Green, and Innovation, we aim for growth through co-creation with our customers. The company's revenues as 3 sectors for fiscal year 2023 (ended March 31, 2024) totaled 8,564.3 billion yen, with 573 consolidated subsidiaries and approximately 270,000 employees worldwide. For more information on Hitachi, please visit the company's website at https://www.hitachi.com. * Certain information contained herein has been obtained from third parties, and in certain cases have not been updated through the date hereof. While these third-party sources are believed to be reliable, Johnson Controls does not give any representation or warranty as to the accuracy, adequacy, timeliness or completeness of any of such information, assumes no responsibility for independent verification of such information, and expressly disclaims any responsibility or liability thereof. View original content to download multimedia:https://www.prnewswire.com/news-releases/johnson-controls-to-sell-residential-and-light-commercial-hvac-businesses-302203723.html

Johnson Controls to Sell Residential and Light Commercial HVAC Businesses By Investing.com

Divestiture Advances Johnson Controls (NYSE:JCI)' Transformation into a Pure-Play Provider of Comprehensive Solutions for Commercial Buildings Transaction Valued At ; JCI Consideration of Company Provides Preliminary 2024 Third Fiscal Quarter Earnings Update , /PRNewswire/ -- Johnson Controls International plc (NYSE: JCI) ("Johnson Controls" or the "Company"), the global leader in smart, healthy, safe and sustainable buildings, today announced it has reached a definitive agreement to sell its Residential and Light Commercial (R&LC) HVAC business in an all-cash transaction to the Bosch Group ("Bosch"). The transaction includes the North America Ducted business and global Residential joint venture with Hitachi (OTC:HTHIY), Ltd. ("Hitachi"), of which Johnson Controls owns 60% and Hitachi owns 40%. The total transaction is valued at , and the Company's portion of the consideration is approximately . As part of the transaction, Hitachi will retain certain ductless HVAC assets located in Shimizu, . Following the close of the transaction, the Johnson Controls portfolio will be substantially simplified with enhanced strategic focus, aligned with the Company's objective to be a pure-play provider of comprehensive solutions for commercial buildings. Johnson Controls delivers a unique value proposition to customers, with its unmatched service and digital offerings that improve commercial building efficiency and reduce operational costs through its OpenBlue digital platform. The transaction represents a significant portion of the Company's previously announced strategic evaluation of non-core product lines. "We are pleased to have reached this pivotal milestone, which accelerates our transformation and positions Johnson Controls as a simpler, higher-growth company," said Johnson Controls Chairman and CEO . "Johnson Controls is already benefiting from our transformation, which enables the unparalleled value proposition we provide to customers, and exposure to rapidly accelerating demand in the data center market and other key macro-economic tailwinds. We believe Johnson Controls is well-positioned for its next phase of growth to deliver enhanced, long-term value to shareholders." Johnson Controls' R&LC HVAC business, which is reported in the Global Products segment, engineers and manufactures ducted and ductless HVAC equipment and components globally for both residential and light commercial applications. In fiscal 2023, the R&LC HVAC business generated approximately in consolidated revenue. Following the close of the transaction, the R&LC HVAC business will continue to provide residential and light commercial HVAC products under the York and Hitachi brands as well as Coleman, Champion, Luxaire, Guardian, Evcon, TempMaster and others. , the deputy chairman of the board of management of Robert Bosch GmbH, said: "Johnson Controls' Residential & Light Commercial business has a consistent track record of excellence within the HVAC industry. Together with our future colleagues in the acquired business, we want to seize the huge opportunities offered by the market for the further growth of this new unit. The acquired entities will strengthen Bosch's Home Comfort Group in an extremely attractive segment and will become part of the Bosch core business." Transaction Details and Use of Proceeds The total consideration of approximately to Johnson Controls includes approximately for its North America Ducted business representing a multiple of 16.7x fiscal 2023 EBITDA and includes approximately for its interest in the Johnson Controls-Hitachi Air Conditioning joint venture representing a multiple of 7.5x fiscal 2023 EBITDA. The transaction is expected to be accretive to profit margins adjusted for the impact of equity income. Net cash proceeds to Johnson Controls is expected to be approximately after tax and transaction-related expenses. Consistent with its capital allocation policy, Johnson Controls expects to pay down debt to the extent required to retain its investment grade rating with the remaining proceeds available to be returned to shareholders. In conjunction with its ongoing transformation and this transaction, the Company has begun working on a comprehensive restructuring plan to minimize dilution post-close. The plan will utilize the work that has been done on functionalization over the past few quarters and leveraging a more streamlined business model focused on growing the Company's commercial buildings solutions franchise. The transaction is expected to close in approximately 12 months, subject to required regulatory approvals and other customary closing conditions. The Company expects to report the operating results of the R&LC HVAC business in discontinued operations beginning in the fourth fiscal quarter of 2024. Johnson Controls Fiscal Q3 2024 Earnings Update Johnson Controls expects 2024 third fiscal quarter adjusted earnings per share to be slightly ahead of its previously issued guidance range. The Company will report third fiscal quarter earnings on . Information concerning 2024 third fiscal quarter adjusted earnings per share presented in this press release is preliminary and may change. Johnson Controls financial closing procedures with respect to the preliminary financial information provided in this press release is not yet complete, and as a result, Johnson Controls final adjusted earnings per share may vary materially from the preliminary outlook included in this press release. Johnson Controls undertakes no obligation to update or supplement the information provided in this press release until Johnson Controls releases its financial statements for the three and nine months ended . The preliminary adjusted earnings per share outlook included in this press release reflects Johnson Controls current estimates based on information available as of the date of this press release and has been prepared by management. This preliminary outlook should not be viewed as a substitute for full financial statements prepared in accordance with GAAP and is not necessarily indicative of the results to be achieved for any future periods. This preliminary outlook could be impacted by the effects of financial closing procedures, final adjustments, and other developments. Non-GAAP Financial Information This press release contains disclosures regarding adjusted earnings per share, which is a non-GAAP performance measure. Management believes that adjusted earnings per share is useful to investors in understanding period-over-period operating results and business trends of Johnson Controls. Management may also use adjusted earnings per share as a guide in forecasting, budgeting and long-term planning processes and for compensation purposes. Adjusted earnings per share should be considered in addition to, and not as replacements for, GAAP EPS the most comparable GAAP measure. Johnson Controls International plc Cautionary Statement Regarding Forward-Looking Statements Johnson Controls International plc has made statements in this press release that are forward-looking and therefore are subject to risks and uncertainties. All statements in this document other than statements of historical fact are, or could be, "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, these forward-looking statements can be identified by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "could," "seeks," "projects," "predicts," "intends," "plans," "estimates," "anticipates" or the negative version of these words or other comparable words. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements include, among other things, statements relating to the sale of the RL&C business, the satisfaction of closing conditions and the likelihood of consummation of the transaction, the expected time period to consummate the transaction, the anticipated benefits of the transaction, Johnson Controls strategy, the anticipated use of proceeds from the transaction, Johnson Controls restructuring plans and Johnson Controls future financial performance. Johnson Controls cautions that these statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond Johnson Controls' control, that could cause its actual results and performance, including the expected impact of the divestiture of the RL&C business, to differ materially from those expressed or implied by such forward-looking statements, include, among others, risks related to the ability to realize the anticipated benefits of the divestiture, including the possibility that expected benefits of portfolio simplification will not be realized or will not be realized within the expected time frame; delays in the closing of the transaction due to regulatory approvals or other closing conditions; unfavorable reaction to the divestiture by customers, competitors, suppliers and employees, disruption from the transaction, making it more difficult to maintain business and operational relationships; significant transaction costs; and other unknown liabilities. Other factors that could cause Johnson Controls' actual results to differ materially from those expressed include, among others, risks related to: Johnson Controls ability to develop or acquire new products and technologies that achieve market acceptance and meet applicable quality and regulatory requirements; the ability to manage general economic, business and capital market conditions, including the impact of recessions, economic downturns and global price inflation; fluctuations in the cost and availability of public and private financing for its customers; the ability to innovate and adapt to emerging technologies, ideas and trends in the marketplace, including the incorporation of technologies such as artificial intelligence; the ability to manage macroeconomic and geopolitical volatility, including shortages impacting the availability of raw materials and component products and the conflicts between and and and Hamas; managing the risks and impacts of potential and actual security breaches, cyberattacks, privacy breaches or data breaches, including business, service, or operational disruptions, the unauthorized access to or disclosure of data, financial loss, reputational damage, increased response and remediation costs, legal, and regulatory proceedings or other unfavorable outcomes; Johnson Controls ability to remediate its material weakness; maintaining and improving the capacity, reliability and security of Johnson Controls enterprise information technology infrastructure; the ability to manage the lifecycle cybersecurity risk in the development, deployment and operation of Johnson Controls digital platforms and services; changes to laws or policies governing foreign trade, including economic sanctions, tariffs, foreign exchange and capital controls, import/export controls or other trade restrictions; fluctuations in currency exchange rates; changes or uncertainty in laws, regulations, rates, policies, or interpretations that impact Johnson Controls business operations or tax status; the ability to adapt to global climate change, climate change regulation and successfully meet Johnson Controls public sustainability commitments; risks and uncertainties related to the settlement with a nationwide class of public water systems concerning the use of AFFF; the outcome of litigation and governmental proceedings; the risk of infringement or expiration of intellectual property rights; Johnson Controls ability to manage disruptions caused by catastrophic or geopolitical events, such as natural disasters, armed conflict, political change, climate change, pandemics and outbreaks of contagious diseases and other adverse public health developments; the ability of Johnson Controls to drive organizational improvement; any delay or inability of Johnson Controls to realize the expected benefits and synergies of recent portfolio transactions; the ability to hire and retain senior management and other key personnel; the tax treatment of recent portfolio transactions; significant transaction costs and/or unknown liabilities associated with such transactions; labor shortages, work stoppages, union negotiations, labor disputes and other matters associated with the labor force; and the cancellation of or changes to commercial arrangements. Investors are therefore cautioned not to place undue resilience on any forward- looking statements. A detailed discussion of risks related to Johnson Controls business is included in the section entitled "Risk Factors" in Johnson Controls Annual Report on Form 10-K for the 2023 fiscal year filed with the SEC, which is available at www.sec.gov and www.johnsoncontrols.com under the "Investors" tab. Shareholders, potential investors and others should consider these factors in evaluating the forward-looking statements and should not place undue reliance on such statements. The forward-looking statements included in this press release are made only as of the date of this document, unless otherwise specified, and, except as required by law, Johnson Controls assumes no obligation, and disclaims any obligation, to update such statements to reflect events or circumstances occurring after the date of this press release. About Johnson Controls At Johnson Controls (NYSE: JCI), we transform the environments where people live, work, learn and play. As the global leader in smart, healthy and sustainable buildings, our mission is to reimagine the performance of buildings to serve people, places and the planet. Building on a proud history of nearly 140 years of innovation, we deliver the blueprint of the future for industries such as healthcare, schools, data centers, airports, stadiums, manufacturing and beyond through OpenBlue, our comprehensive digital offering. Today, with a global team of 100,000 experts in more than 150 countries, Johnson Controls offers the world's largest portfolio of building technology and software as well as service solutions from some of the most trusted names in the industry. Visit www.johnsoncontrols.com for more information and follow @Johnson Controls on social platforms. About the Bosch Group The Bosch Group is a leading global supplier of technology and services. It employs roughly 429,000 associates worldwide (as of ). The company generated sales of in 2023. Its business operations are divided into four business sectors: Mobility, Industrial Technology, Consumer Goods, and Energy and . Through its business operations, the company wants to help give technological shape to universal trends such as automation, electrification, digitalization, and connectivity, as well as an orientation to sustainability. Bosch's broad diversification across regions and industries strengthens its innovativeness and robustness. Bosch uses its proven expertise in sensor technology, software, and services to offer customers cross-domain solutions from a single source. It also applies its expertise in connectivity and artificial intelligence in order to develop and manufacture user-friendly, sustainable products. With technology that is "Invented for life," Bosch wants to help improve quality of life and conserve natural resources. The Bosch Group comprises Robert Bosch GmbH and its roughly 470 subsidiary and regional companies in over 60 countries. Including sales and service partners, Bosch's global manufacturing, engineering, and sales network covers nearly every country in the world. Bosch's innovative strength is key to the company's further development. At 136 locations across the globe, Bosch employs some 90,000 associates in research and development, of which nearly 48,000 are software engineers. About Hitachi, Ltd. Hitachi drives Social Innovation Business, creating a sustainable society through the use of data and technology. We solve customers' and society's challenges with Lumada solutions leveraging IT, OT (Operational Technology) and products. Hitachi operates under the 3 business sectors of "Digital Systems & Services" " supporting our customers' digital transformation; "Green Energy & Mobility" " contributing to a decarbonized society through energy and railway systems, and "Connective Industries" " connecting products through digital technology to provide solutions in various industries. Driven by Digital, Green, and Innovation, we aim for growth through co-creation with our customers. The company's revenues as 3 sectors for fiscal year 2023 (ended ) totaled , with 573 consolidated subsidiaries and approximately 270,000 employees worldwide. For more information on Hitachi, please visit the company's website at https://www.hitachi.com. Certain information contained herein has been obtained from third parties, and in certain cases have not been updated through the date hereof. While these third-party sources are believed to be reliable, Johnson Controls does not give any representation or warranty as to the accuracy, adequacy, timeliness or completeness of any of such information, assumes no responsibility for independent verification of such information, and expressly disclaims any responsibility or liability thereof.

Johnson Controls to Sell Residential and Light Commercial HVAC Businesses - Johnson Controls Intl (NYSE:JCI)

Divestiture Advances Johnson Controls' Transformation into a Pure-Play Provider of Comprehensive Solutions for Commercial Buildings Transaction Valued At $8.1 Billion; JCI Consideration of $6.7 Billion Company Provides Preliminary 2024 Third Fiscal Quarter Earnings Update CORK, Ireland, July 23, 2024 /PRNewswire/ -- Johnson Controls International plc JCI ("Johnson Controls" or the "Company"), the global leader in smart, healthy, safe and sustainable buildings, today announced it has reached a definitive agreement to sell its Residential and Light Commercial (R&LC) HVAC business in an all-cash transaction to the Bosch Group ("Bosch"). The transaction includes the North America Ducted business and global Residential joint venture with Hitachi, Ltd. ("Hitachi"), of which Johnson Controls owns 60% and Hitachi owns 40%. The total transaction is valued at $8.1 billion, and the Company's portion of the consideration is approximately $6.7 billion. As part of the transaction, Hitachi will retain certain ductless HVAC assets located in Shimizu, Japan. Following the close of the transaction, the Johnson Controls portfolio will be substantially simplified with enhanced strategic focus, aligned with the Company's objective to be a pure-play provider of comprehensive solutions for commercial buildings. Johnson Controls delivers a unique value proposition to customers, with its unmatched service and digital offerings that improve commercial building efficiency and reduce operational costs through its OpenBlue digital platform. The transaction represents a significant portion of the Company's previously announced strategic evaluation of non-core product lines. "We are pleased to have reached this pivotal milestone, which accelerates our transformation and positions Johnson Controls as a simpler, higher-growth company," said Johnson Controls Chairman and CEO George Oliver. "Johnson Controls is already benefiting from our transformation, which enables the unparalleled value proposition we provide to customers, and exposure to rapidly accelerating demand in the data center market and other key macro-economic tailwinds. We believe Johnson Controls is well-positioned for its next phase of growth to deliver enhanced, long-term value to shareholders." Johnson Controls' R&LC HVAC business, which is reported in the Global Products segment, engineers and manufactures ducted and ductless HVAC equipment and components globally for both residential and light commercial applications. In fiscal 2023, the R&LC HVAC business generated approximately $4.5 billion in consolidated revenue. Following the close of the transaction, the R&LC HVAC business will continue to provide residential and light commercial HVAC products under the York and Hitachi brands as well as Coleman, Champion, Luxaire, Guardian, Evcon, TempMaster and others. Christian Fischer, the deputy chairman of the board of management of Robert Bosch GmbH, said: "Johnson Controls' Residential & Light Commercial business has a consistent track record of excellence within the HVAC industry. Together with our future colleagues in the acquired business, we want to seize the huge opportunities offered by the market for the further growth of this new unit. The acquired entities will strengthen Bosch's Home Comfort Group in an extremely attractive segment and will become part of the Bosch core business." Transaction Details and Use of Proceeds The total consideration of approximately $6.7 billion to Johnson Controls includes approximately $4.6 billion for its North America Ducted business representing a multiple of 16.7x fiscal 2023 EBITDA and includes approximately $2.1 billion for its interest in the Johnson Controls-Hitachi Air Conditioning joint venture representing a multiple of 7.5x fiscal 2023 EBITDA. The transaction is expected to be accretive to profit margins adjusted for the impact of equity income. Net cash proceeds to Johnson Controls is expected to be approximately $5.0 billion after tax and transaction-related expenses. Consistent with its capital allocation policy, Johnson Controls expects to pay down debt to the extent required to retain its investment grade rating with the remaining proceeds available to be returned to shareholders. In conjunction with its ongoing transformation and this transaction, the Company has begun working on a comprehensive restructuring plan to minimize dilution post-close. The plan will utilize the work that has been done on functionalization over the past few quarters and leveraging a more streamlined business model focused on growing the Company's commercial buildings solutions franchise. The transaction is expected to close in approximately 12 months, subject to required regulatory approvals and other customary closing conditions. The Company expects to report the operating results of the R&LC HVAC business in discontinued operations beginning in the fourth fiscal quarter of 2024. Johnson Controls Fiscal Q3 2024 Earnings Update Johnson Controls expects 2024 third fiscal quarter adjusted earnings per share to be slightly ahead of its previously issued guidance range. The Company will report third fiscal quarter earnings on July 31, 2024. Advisors Centerview Partners and Citi served as financial advisors to Johnson Controls, Simpson Thacher served as legal advisor, and Joele Frank served as investor relations advisor. Preliminary Information Information concerning 2024 third fiscal quarter adjusted earnings per share presented in this press release is preliminary and may change. Johnson Controls financial closing procedures with respect to the preliminary financial information provided in this press release is not yet complete, and as a result, Johnson Controls final adjusted earnings per share may vary materially from the preliminary outlook included in this press release. Johnson Controls undertakes no obligation to update or supplement the information provided in this press release until Johnson Controls releases its financial statements for the three and nine months ended June 30, 2024. The preliminary adjusted earnings per share outlook included in this press release reflects Johnson Controls current estimates based on information available as of the date of this press release and has been prepared by management. This preliminary outlook should not be viewed as a substitute for full financial statements prepared in accordance with GAAP and is not necessarily indicative of the results to be achieved for any future periods. This preliminary outlook could be impacted by the effects of financial closing procedures, final adjustments, and other developments. Non-GAAP Financial Information This press release contains disclosures regarding adjusted earnings per share, which is a non-GAAP performance measure. Management believes that adjusted earnings per share is useful to investors in understanding period-over-period operating results and business trends of Johnson Controls. Management may also use adjusted earnings per share as a guide in forecasting, budgeting and long-term planning processes and for compensation purposes. Adjusted earnings per share should be considered in addition to, and not as replacements for, GAAP EPS the most comparable GAAP measure. Johnson Controls International plc Cautionary Statement Regarding Forward-Looking Statements Johnson Controls International plc has made statements in this press release that are forward-looking and therefore are subject to risks and uncertainties. All statements in this document other than statements of historical fact are, or could be, "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, these forward-looking statements can be identified by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "could," "seeks," "projects," "predicts," "intends," "plans," "estimates," "anticipates" or the negative version of these words or other comparable words. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements include, among other things, statements relating to the sale of the RL&C business, the satisfaction of closing conditions and the likelihood of consummation of the transaction, the expected time period to consummate the transaction, the anticipated benefits of the transaction, Johnson Controls strategy, the anticipated use of proceeds from the transaction, Johnson Controls restructuring plans and Johnson Controls future financial performance. Johnson Controls cautions that these statements are subject to numerous important risks, uncertainties, assumptions and other factors, some of which are beyond Johnson Controls' control, that could cause its actual results and performance, including the expected impact of the divestiture of the RL&C business, to differ materially from those expressed or implied by such forward-looking statements, include, among others, risks related to the ability to realize the anticipated benefits of the divestiture, including the possibility that expected benefits of portfolio simplification will not be realized or will not be realized within the expected time frame; delays in the closing of the transaction due to regulatory approvals or other closing conditions; unfavorable reaction to the divestiture by customers, competitors, suppliers and employees, disruption from the transaction, making it more difficult to maintain business and operational relationships; significant transaction costs; and other unknown liabilities. Other factors that could cause Johnson Controls' actual results to differ materially from those expressed include, among others, risks related to: Johnson Controls ability to develop or acquire new products and technologies that achieve market acceptance and meet applicable quality and regulatory requirements; the ability to manage general economic, business and capital market conditions, including the impact of recessions, economic downturns and global price inflation; fluctuations in the cost and availability of public and private financing for its customers; the ability to innovate and adapt to emerging technologies, ideas and trends in the marketplace, including the incorporation of technologies such as artificial intelligence; the ability to manage macroeconomic and geopolitical volatility, including shortages impacting the availability of raw materials and component products and the conflicts between Russia and Ukraine and Israel and Hamas; managing the risks and impacts of potential and actual security breaches, cyberattacks, privacy breaches or data breaches, including business, service, or operational disruptions, the unauthorized access to or disclosure of data, financial loss, reputational damage, increased response and remediation costs, legal, and regulatory proceedings or other unfavorable outcomes; Johnson Controls ability to remediate its material weakness; maintaining and improving the capacity, reliability and security of Johnson Controls enterprise information technology infrastructure; the ability to manage the lifecycle cybersecurity risk in the development, deployment and operation of Johnson Controls digital platforms and services; changes to laws or policies governing foreign trade, including economic sanctions, tariffs, foreign exchange and capital controls, import/export controls or other trade restrictions; fluctuations in currency exchange rates; changes or uncertainty in laws, regulations, rates, policies, or interpretations that impact Johnson Controls business operations or tax status; the ability to adapt to global climate change, climate change regulation and successfully meet Johnson Controls public sustainability commitments; risks and uncertainties related to the settlement with a nationwide class of public water systems concerning the use of AFFF; the outcome of litigation and governmental proceedings; the risk of infringement or expiration of intellectual property rights; Johnson Controls ability to manage disruptions caused by catastrophic or geopolitical events, such as natural disasters, armed conflict, political change, climate change, pandemics and outbreaks of contagious diseases and other adverse public health developments; the ability of Johnson Controls to drive organizational improvement; any delay or inability of Johnson Controls to realize the expected benefits and synergies of recent portfolio transactions; the ability to hire and retain senior management and other key personnel; the tax treatment of recent portfolio transactions; significant transaction costs and/or unknown liabilities associated with such transactions; labor shortages, work stoppages, union negotiations, labor disputes and other matters associated with the labor force; and the cancellation of or changes to commercial arrangements. Investors are therefore cautioned not to place undue resilience on any forward- looking statements. A detailed discussion of risks related to Johnson Controls business is included in the section entitled "Risk Factors" in Johnson Controls Annual Report on Form 10-K for the 2023 fiscal year filed with the SEC, which is available at www.sec.gov and www.johnsoncontrols.com under the "Investors" tab. Shareholders, potential investors and others should consider these factors in evaluating the forward-looking statements and should not place undue reliance on such statements. The forward-looking statements included in this press release are made only as of the date of this document, unless otherwise specified, and, except as required by law, Johnson Controls assumes no obligation, and disclaims any obligation, to update such statements to reflect events or circumstances occurring after the date of this press release. About Johnson Controls At Johnson Controls JCI, we transform the environments where people live, work, learn and play. As the global leader in smart, healthy and sustainable buildings, our mission is to reimagine the performance of buildings to serve people, places and the planet. Building on a proud history of nearly 140 years of innovation, we deliver the blueprint of the future for industries such as healthcare, schools, data centers, airports, stadiums, manufacturing and beyond through OpenBlue, our comprehensive digital offering. Today, with a global team of 100,000 experts in more than 150 countries, Johnson Controls offers the world's largest portfolio of building technology and software as well as service solutions from some of the most trusted names in the industry. Visit www.johnsoncontrols.com for more information and follow @Johnson Controls on social platforms. About the Bosch Group* The Bosch Group is a leading global supplier of technology and services. It employs roughly 429,000 associates worldwide (as of December 31, 2023). The company generated sales of 91.6 billion euros in 2023. Its business operations are divided into four business sectors: Mobility, Industrial Technology, Consumer Goods, and Energy and Building Technology. Through its business operations, the company wants to help give technological shape to universal trends such as automation, electrification, digitalization, and connectivity, as well as an orientation to sustainability. Bosch's broad diversification across regions and industries strengthens its innovativeness and robustness. Bosch uses its proven expertise in sensor technology, software, and services to offer customers cross-domain solutions from a single source. It also applies its expertise in connectivity and artificial intelligence in order to develop and manufacture user-friendly, sustainable products. With technology that is "Invented for life," Bosch wants to help improve quality of life and conserve natural resources. The Bosch Group comprises Robert Bosch GmbH and its roughly 470 subsidiary and regional companies in over 60 countries. Including sales and service partners, Bosch's global manufacturing, engineering, and sales network covers nearly every country in the world. Bosch's innovative strength is key to the company's further development. At 136 locations across the globe, Bosch employs some 90,000 associates in research and development, of which nearly 48,000 are software engineers. About Hitachi, Ltd.* Hitachi drives Social Innovation Business, creating a sustainable society through the use of data and technology. We solve customers' and society's challenges with Lumada solutions leveraging IT, OT (Operational Technology) and products. Hitachi operates under the 3 business sectors of "Digital Systems & Services" - supporting our customers' digital transformation; "Green Energy & Mobility" - contributing to a decarbonized society through energy and railway systems, and "Connective Industries" - connecting products through digital technology to provide solutions in various industries. Driven by Digital, Green, and Innovation, we aim for growth through co-creation with our customers. The company's revenues as 3 sectors for fiscal year 2023 (ended March 31, 2024) totaled 8,564.3 billion yen, with 573 consolidated subsidiaries and approximately 270,000 employees worldwide. For more information on Hitachi, please visit the company's website at https://www.hitachi.com. * Certain information contained herein has been obtained from third parties, and in certain cases have not been updated through the date hereof. While these third-party sources are believed to be reliable, Johnson Controls does not give any representation or warranty as to the accuracy, adequacy, timeliness or completeness of any of such information, assumes no responsibility for independent verification of such information, and expressly disclaims any responsibility or liability thereof. Investor Contacts: Jim Lucas Direct: 1-414-340-1752 Email: [email protected] Danielle Canzanella Direct : 1-414-524-8687 Email : [email protected] View original content to download multimedia:https://www.prnewswire.com/news-releases/johnson-controls-to-sell-residential-and-light-commercial-hvac-businesses-302203723.html SOURCE Johnson Controls, Inc. Market News and Data brought to you by Benzinga APIs

Johnson Controls To Boost Profit Margins With $8.1B Bosch Deal - Johnson Controls Intl (NYSE:JCI)

Proceeds of $5 billion will be used to reduce debt and return funds to shareholders. Johnson Controls International plc JCI shares are trading higher after the company agreed to sell its Residential and Light Commercial (R&LC) HVAC business to the Bosch Group. The total transaction is valued at $8.1 billion, with Johnson Controls' share of around $6.7 billion. The transaction includes $4.6 billion for its North America Ducted business (16.7x fiscal 2023 EBITDA) and $2.1 billion for its stake in the Johnson Controls-Hitachi Air Conditioning joint venture (7.5x fiscal 2023 EBITDA) in which Johnson Controls holds a 60% stake, and Hitachi owns 40%. Johnson Controls is projected to receive net cash proceeds of around $5.0 billion after taxes and transaction-related costs. Following its capital allocation policy, Johnson Controls plans to use the proceeds to reduce debt and maintain its investment-grade rating, with the remaining funds to be returned to shareholders. The transaction is anticipated to enhance profit margins once it is adjusted for the effects of equity income. The transaction is anticipated to close in about 12 months, pending regulatory approvals and standard conditions, with the R&LC HVAC business to be reported as discontinued operations starting in Q4 2024. As part of its ongoing transformation and this transaction, the company is developing a restructuring plan to minimize post-close dilution, leveraging recent functionalization efforts and focusing on strengthening its commercial buildings solutions business. Johnson Controls expects third-quarter 2024 adjusted EPS to exceed its prior guidance slightly. The company anticipates to report earnings on July 31. Investors can gain exposure to the stock via First Trust NASDAQ Clean Edge Smart Grid Infrastructure Index Fund GRID and Carbon Collective Climate Solutions U.S. Equity ETF CCSO. Price Action: JCI shares are trading lower by 1.81% at $68.94 at the last check Tuesday. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Read Next: Activist Investor Elliott Acquires Major Stake In Johnson Controls: Report Image created using artificial intelligence via Midjourney. Market News and Data brought to you by Benzinga APIs