Honeywell to Split into Three Public Companies: Honeywell Automation, Honeywell Aerospace, and Advanced Materials
Honeywell (HON), an industrial conglomerate, announced a major restructuring plan that will result in the company splitting into three independent, publicly traded entities. The move, which is expected to be completed by the second half of 2026, is intended to unlock value for shareholders and enhance focus and growth strategies for each division.
Honeywell Automation
Honeywell Automation will focus on the development and deployment of automation technologies, including building systems, process control, and smart city solutions.
Honeywell Aerospace
Honeywell Aerospace will specialize in avionics, navigation, and other technologies for the aviation industry, covering both commercial and military applications.
Advanced Materials
Honeywell Advanced Materials will focus on providing innovative materials solutions for industries such as healthcare, energy, and transportation.
Market Response and Analyst Outlook
The announcement of the split was met with a decline in Honeywell's stock price in pre-market trading, but analysts remain optimistic about the long-term potential of the move. JPMorgan analyst Stephen Tusa estimates that Honeywell could be worth up to $330 per share if broken up, significantly higher than its current trading price of around $212.
Growth-Oriented Transformation
CEO Vimal Kapur stated that the restructuring is part of a broader transformation to position Honeywell as a growth-oriented company. The company has been undergoing a strategic portfolio shift to focus on end markets and enhance its capabilities in new product development and innovation.
Support from Elliott Management
Activist investor Elliott Management, which acquired a $5 billion stake in Honeywell in November 2023, expressed support for the split. Elliott partners Marc Steinberg and Jesse Cohn believe the move will enhance Honeywell's operational efficiency and valuation upside.