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Highlights

  • Johnson Matthey has agreed to sell its Catalyst Technologies division to Honeywell for £1.8 billion, with net proceeds of approximately £1.6 billion.

  • The company will return around £1.4 billion to shareholders, equivalent to £8 per share, once the transaction is completed by H1 2026.

  • JM will refocus on its Clean Air and PGMS businesses, aiming to drive sustained cash generation and increase shareholder returns to at least £200 million annually from FY2026/27.

Johnson Matthey Plc (LSE:JMAT) has announced a landmark agreement to sell its Catalyst Technologies (CT) business to Honeywell International Inc. for an enterprise value of £1.8 billion on a cash and debt-free basis. 

The transaction, expected to close in the first half of 2026, is set to deliver net proceeds of approximately £1.6 billion, after deducting around £200 million in one-off costs, including taxes and pension contributions.

JM plans to return £1.4 billion of these proceeds to shareholders — approximately £8 per share, which represents 88% of the net sale proceeds. The remaining £200 million will be retained for general corporate purposes and to maintain a healthy balance sheet, placing the group comfortably within its target leverage range of 1.0x–1.5x net debt to EBITDA.

Strategic Repositioning Towards Clean Air and PGMS

Post-transaction, Johnson Matthey will focus on its core Clean Air and Platinum Group Metal Services (PGMS) divisions — both of which operate in resilient, long-term growth markets. The company aims to drive at least mid-single digit compound annual growth (CAGR) in underlying operating profit from FY2024/25 to FY2027/28.

JM’s deep expertise in PGMs will continue to serve as a commercial advantage, reinforcing its leadership position in emissions control technologies and sustainable materials.

Cash Generation and Shareholder Value Creation

JM projects significant cash flow growth, targeting at least £250 million in free cash flow by FY2027/28, driven by profit growth, reduced capital expenditure, and working capital optimisation. Alongside the one-off return from the CT sale, the group has refreshed its capital allocation framework, committing to annual shareholder returns of at least £130 million in FY2025/26, growing to at least £200 million in FY2026/27 and beyond.

Impact of the Transaction on JM’s Financials

As of 31 March 2025:

  • CT’s EBITDA was £119 million, and operating profit stood at £92 million.

  • The divestment implies a pro forma adjustment to the group’s financials, reducing underlying operating profit to £297 million.

  • Total group assets and liabilities will also reduce to £4.63 billion and £2.91 billion respectively.