(Bloomberg) -- Honeywell International Inc. plans to use cash and debt to pay for its $4.95 billion acquisition of Carrier Global Corp.’s security business and will tap the bond market next year, its finance chief said. 

“We will fund this part cash, part debt,” Chief Financial Officer Greg Lewis said in a telephone interview on Monday, adding that Honeywell also wants to raise funding to refinance upcoming maturities. 

Charlotte, North Carolina-based Honeywell on Dec. 8 said it would acquire the Carrier unit to enhance its building automation business as it works to align its portfolio around three major trends including automation, the future of aviation and the energy transition. 

The transaction is expected to close at the end of the third quarter in 2024. Honeywell will wait to see where rates are headed in 2024 before it taps markets, Lewis said. 

“We have reached the peak and from here, we would expect that to improve over time,” Lewis said, referring to interest rates.

The US Federal Reserve is widely expected to hold interest rates steady at its meeting this week, with investors and market participants betting on rate cuts in 2024. 

Honeywell hasn’t taken out bridge financing and reported $7.8 billion in cash and cash equivalents as of Sept. 30. It could use that cash for the acquisition in case it doesn’t tap bond investors, Lewis said. 

The company has about $1.15 billion in debt coming due in 2024 — along side some euro-denominated debt — followed by $1.25 billion in 2025, according to data compiled by Bloomberg. Honeywell is considering to use some of the cash on its balance sheet to pay down some of the debt early, Lewis said.

The company continues to scout for potential acquisitions in the security industry, Lewis said. 

“I wouldn’t say that our appetite is saturated,” he added.

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