Honeywell CFO sees reset of deal values in '09

BOSTON (Reuters) - Diversified U.S. manufacturer Honeywell International Inc (HON.N) sees the opportunity for more acquisitions in 2009 as sellers adjust to lower prices, a top executive said on Friday.

"You will see this be an environment in which companies ... will become available," Chief Financial Officer Dave Anderson said in a phone interview. "You will definitely see, I think, a reset of valuations, lower valuations and you'll also see more availability, more people either having to sell or wanting to sell. People will be open to sell in this environment."

Dealmaking slowed last year as falling stock prices made some sellers unwilling to agree to terms at sharply lower valuations than they would have seen in 2006 and 2007. The credit crunch hindered many buyers' ability to finance deals.

As U.S. equities have fallen about 35 percent over the past year -- as measured by the broad Standard & Poor's 500 index .SPX -- more sellers may accept that prices are not likely to climb any time soon.

"The issue is going to be the forward visibility on their earnings, so what appears cheap may actually not be cheap," Anderson said.

The Morris Township, New Jersey-based company is generally confident in its order backlog, Anderson said.

While he said there had been "some evidence" of delays on orders of equipment from small oil refiners and other companies that had planned new investments based on last summer's record-high energy prices, no "significant" projects have been canceled.

"For the large state-owned and the large integrated oil companies ... you won't see that much project cancellations, you'll see some deferrals or delays," Anderson said. "They never planned for the very big uptick that we experienced in mid-'08 in terms of oil prices."

(Reporting by Scott Malone; Editing by Lisa Von Ahn)