Honeywell, one of the few remaining US industrial conglomerates, will
split into three companies
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 [February 07, 2025] By
MICHELLE CHAPMAN
Honeywell, one of the last remaining U.S. industrial conglomerates, will
split into three independent companies, following in the footsteps of
manufacturing giants like General Electric and Alcoa.
The company said Thursday that it will separate from its automation and
aerospace technologies businesses. Including plans announced earlier to
spin off its advanced materials business, Honeywell will consist of
three smaller entities in hopes that they will each be more agile.
"The formation of three independent, industry-leading companies builds
on the powerful foundation we have created, positioning each to pursue
tailored growth strategies, and unlock significant value for
shareholders and customers,” Honeywell Chairman and CEO Vimal Kapur said
in a statement.
Honeywell had said in December that it was considering spinning off its
aerospace division. The public announcement arrived about one month
after Elliott Investment Management revealed a stake of more than $5
billion in the aerospace, automation and materials company. Elliott had
been pushing for the Charlotte, North Carolina, company to separate its
automation and aerospace businesses.
The board of Honeywell International Inc. had been exploring strategic
options for the company since earlier in 2024.
The company, which makes everything from eye solution to barcode
readers, has been seeking ways to make itself more nimble. Over the past
year and a half, just after Kapur took over as CEO, Honeywell has
announced plans for the advanced materials business spinoff, entered
into an agreement to sell its personal protective equipment business,
and made several acquisitions.
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A Honeywell plant on April 4, 2020, in Phoenix. (AP Photo/Matt York,
File)
 The separation of the automation and
aerospace technologies businesses is expected to be completed in the
second half of 2026. The spinoff of the advanced materials business
is anticipated to be completed by the end of this year or early next
year.
Like Honeywell, other U.S. conglomerates have been pressured by
shareholders to simplify their structures, allowing each segment of
the company to move more freely and adapt to changes in their
respective markets.
Iconic CEOs like Jack Welch of General Electric spent years building
corporate American behemoths with the belief that with scale came
power. Yet those massive companies were forced to compete with
upstarts with a narrow focus and a more clearly defined set of
goals.
Investors also wanted a more clear view of the priorities within
each division, which became more murky as the companies grew.
In 2015 metals maker Alcoa said that it was splitting into two
independent companies, separating its bauxite, aluminum and casting
operations from its engineering, transportation and global rolled
products businesses.
GE announced in 2021 that it was dividing itself into three public
companies focused on aviation, health care and energy. At the time,
the move was viewed as a potential signal of the end of
conglomerates as a whole thanks to the move toward a digital
economy.
Shares fell almost 3% before the market opened Thursday.
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