Bank of Montreal’s investment banking unit is leading a US$1.8 billion debt deal supporting the sale of Honeywell International Inc.’s productivity solutions and services business to industrial manufacturer Brady Corp.
BMO Capital Markets will syndicate a US$1 billion term loan to other Wall Street lenders, according to people with knowledge of the transaction. The bank is also weighing whether to sell an US$800 million slice of debt to investors in the investment-grade bond or private-placement markets, they said, asking not to be named discussing a private matter.
The Canadian lender underwrote the transaction with a US$1.8 billion bridge loan, according to a securities filing from Brady.
Representatives for BMO and Brady declined to comment.
If Brady raises funds through a private placement it will join a growing number of companies that have used the financing method to bypass volatile public bond markets . Both fast-food chain Chick-fil-A Inc. and data giant Oracle Corp. sold types of private bonds recently, according to Bloomberg reporting.
Private placements source funding directly from institutional investors, like life insurers, and don’t require the same regulatory securities filings that are obligatory in public deals. This can help borrowers maintain a relatively low profile and often speed up the funding process.
Honeywell’s productivity solutions and services business, known as PSS, is a provider of mobile computers, barcode scanners and printing solutions for the logistics market and had about US$1.1 billion in revenue in 2025. Brady agreed to buy the business for US$1.4 billion earlier this month.
Within two years of the deal’s closing, Brady expects to have a leverage ratio of less than two times net debt to earnings before interest, taxes, depreciation and amortization.
The sale is the latest move by Honeywell to reshape its portfolio as it pursues a multi-part breakup. The manufacturing conglomerate announced in July that it was evaluating strategic alternatives for two businesses, including PSS.