Honeywell Expects To Make $110 Million In Asbestos

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Honeywell Expects To Make $110 Million In Asbestos
Morristown Township, NJ, Nov. 7--Honeywell International Inc. said it expects to make $110 million of asbestos-related payments during the fourth quarter, according to a quarterly report filed Friday with the Securities and Exchange Commission. The company made asbestos-related payments of $467 million, including legal fees, in the first three quarters of 2003, the filing said. Honeywell said its estimate is based on its experience in the three quarters regarding when plaintiff firms submit required evidential data, the filing said. According to the filing, Honeywell has resolved about 62,500 asbestos-related claims from 1981 to Sept. 30 in connection with its Bendix Friction Materials business, which manufactured automotive brake pads that included asbestos in an encapsulated form. The average indemnity cost per claim of the Bendix cases is about $2,900, the filing said. There are about 71,000 claims pending, according to the filing. Honeywell reiterated in the filing that it didn't mine or produce asbestos, nor did it make or sell insulation products or other construction materials that have been identified as the primary cause of asbestos-related disease in the vast majority of the claims. The company said it has made several products that contained small amounts of asbestos. Another source of asbestos claims is refractory products sold largely to the steel industry in the East and Midwest by North American Refractories Co., a business Honeywell owned from 1979 to 1986. North American Refractories filed for bankruptcy in January 2002 and is reorganizing. Honeywell said that definitive agreements have been reached with about 256,000 claimants, or more than 90% of the 275,000 claimants expected to file a claim as part of North American Refractories' reorganization. In October, Honeywell received about $150 million in cash from various insurance companies related to its North American Refractories asbestos claims, the filing said. Honeywell said it has $1.3 billion of insurance remaining that can be specifically allocated to North American Refractories-related liability.