Johnson Matthey shares tank as Honeywell deal price slashed

(Sharecast News) - Shares in Johnson Matthey plunged on Monday after the company slashed almost half a billion pounds from the sale price of its catalyst technologies business to Honeywell after reports the American conglomerate was thinking about walking away from the deal. Honeywell will now pay £1.33bn, down from the previously agreed £1.8bn last May as Johnson Matthey moves to focus on its car pollution filters platinum group metals processing businesses. Shares in the UK-listed company fell 15.5% in early trade.

Bloomberg on Sunday reported Honeywell was considering walking away because of concerns over regulatory approvals and business milestones.

Johnson Matthey said the reduced price reflected the unit's performance during the 2025/26 financial year including the deferral of key sustainable solutions licensing projects and a challenging market environment for the supply of catalysts.

It added that the proposed shareholder return from the deal had been cut to £1bn from the £1.6bn originally planned.

The deal deadline was also extended to July 21 from February 21, with a possible further extension to August 21 if competition approvals are still outstanding.

Johnson Matthey reaffirmed full year guidance, including group underlying operating profit growth at the higher end of a mid- single digit percentage range, and positive free cash flow "that is materially higher than last year".

AJ Bell investment director Russ Mould: "Johnson Matthey already faces disruption to its biggest profit engine - the catalytic converter focused Clean Air division - from the move to electric vehicles. A move to a new business model emphasising cash generation may be progressing well and trading may be in line with expectations but it can ill afford the kind of setback it has endured today."

Reporting by Frank Prenesti for Sharecast.com