Smiths Group to Sell Interconnect Division to Koch’s Molex for £1.3 Billion

Smiths Group (LON: SMIN) shares rose over 1% at the open on Friday after it announced an agreement to sell its Smiths Interconnect division to Molex Electronic Technologies Holdings.

The transaction values Smiths Interconnect at an enterprise value of £1.3 billion. This figure represents a multiple of 15.1x the division's headline EBITDA of £86.1 million for the fiscal year 2025.

Smiths will receive cash consideration, subject to customary adjustments for working capital, cash, and debt.

The divestiture aligns with Smiths' strategic initiatives, unveiled on January 31, 2025, aimed at maximizing value creation, unlocking portfolio value, and enhancing shareholder returns.

The sale of Smiths Interconnect marks a significant stride in the company's strategic shift towards becoming a more focused industrial engineering enterprise. The transaction is expected to be finalized in the second half of fiscal year 2026.

Smiths Group is also progressing with its previously announced £500 million share buyback program, slated for completion by the end of calendar year 2025.

The company has affirmed its commitment to returning a substantial portion of the proceeds from the Smiths Interconnect sale to shareholders. Simultaneously, Smiths intends to maintain an investment-grade credit rating, reflecting its desire for an efficient balance sheet management.

The Board of Smiths Group plans to provide a detailed update on the utilization of the proceeds from the sale during its Q1 FY2026 Trading Statement, scheduled for release on November 19, 2025. In parallel with this transaction, Smiths continues to advance both the sale and demerger processes for its Smiths Detection division.

Roland Carter, Chief Executive of Smiths Group, emphasized the strategic importance of the deal. “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.”

He also acknowledged the contributions of Smiths Interconnect employees and expressed confidence in Molex's ability to support their future growth.

Under French employment laws, Smiths is required to consult with its French Works Council before finalizing the transaction. This consultation process is expected to commence shortly. While Smiths will consider the views of the French Works Council, their opinion is consultative and non-binding.

Following the consultation, Smiths will have the unilateral right to require Molex to enter into a binding share purchase agreement, subject to customary conditions and regulatory approvals.

The headline FY2025 EBITDA figure of £86.1 million excludes the contribution from the US sub-systems business unit of Smiths Interconnect, which was already reported as agreed for sale in Smiths' full-year 2025 results and completed in October 2025.