Honeywell to Split Into Three Publicly Traded Companies

CHARLOTTE, ​N.C., February 10, 2025 ​- In a major restructuring movement, Honeywell (NASDAQ: HON) announced its intention to separate its Automation, Aerospace and Advanced Materials activities from three independent and publicly traded companies. This ​decision marks the conclusion of a one-year ​strategic review by Vimal Kapur’s Board ​of Directors and CEO, with the aim of deepening the approach, releasing shareholder value and positioning each ​entity for specific growth.

Why is Honeywell divided into three companies?

According to Honeywell’s announcement, the restructuring will allow each company to operate with a more focused ​strategy, ​benefiting from simplified decision-making and different financial priorities. Planned departures should be tax-free for Honeywell shareholders and completed in ​the second half of 2026.

Director General ​Vimal Kapur pointed out that the movement is aligned with ​the broader industry trends, saying: ​”The formation of three independent industry leaders is ​based on the ​powerful foundation we have ​created, positioning each one to pursue customized growth strategies ​and release significant value for shareholders and customers. »

Breakdown of the three new enterprises

Honeywell ​Automation

Honeywell’s new automation company will focus on industrial automation, digital transformation ​and AI-based ​process solutions. With an $18 ​billion revenue projection in 2024, the company aims to drive the transition ​from ​automation to autonomy by integrating software and AI technologies. ​It will benefit ​from industries ranging from manufacturing and logistics to intelligent infrastructure.

The value of automation is also closely linked ​to Honeywell’s majority stake in Quantinuum, a leading quantum computing company. Market analysts predict that Quantinuum could overcome Aeronautics in evaluation, given its potential ​applications in cybersecurity, hardware ​science and artificial intelligence.

Honeywell Aerospace

The Aerospace Division, which generates annual revenues of approximately $15 billion, provides propulsion, avionics and satellite communications systems for commercial and defence markets. The division should strengthen its position as one of the world’s largest aerospace suppliers, ​focusing on sustainability, electrification and next-generation aeronautical technologies.

Vimal ​Kapur stressed the moment of separation, saying: “As ​aerospace prepares for an unprecedented demand in the coming years ​in the commercial ​and defence markets, it is now time for the company to start ​its own ​journey as an independent public company. »

Advanced Materials

Advanced materials will specialize in high performance chemicals, industrial fibres and durable ​packaging solutions. It is expected to generate nearly $4 billion in revenue, focusing on green innovations such as Solstice ® hydrofluoroolefine (HFO) technology, which reduces global warming potential.

Investor ​reaction and market consequences

The activist investor Elliott Management, who took a $5 billion stake in Honeywell last year, was one of the main drivers of the break. Elliott partner Marc ​Steinberg and his partner, Jesse Cohn, said: “Improving the approach, alignment and strategic agility allowed by this separation will allow Honeywell to realize the possibility of operational improvement and ​reverse evaluation

While analysts generally support the movement, some caution that ​it may take time for investors to see all the benefits. RBC Capital Markets noted that ​while industrial benefits often exceed the market, immediate ​equity gains can be limited.

And then ​Honeywell and his shareholders?

The company expects the spin-off of advanced materials to be completed in late 2025 or early 2026, with the Automatization and Aerospace separations after the second half of 2026. Honeywell is also exploring the possibilities of IPO for Quantinuum, but is ​waiting for the market to be more sensitive to quantum computing investments.

As ​the separation process develops, investors ​will ​closely monitor how each new entity develops, particularly in emerging areas such as IV, quantum computing and sustainable technologies. For now, Honeywell’s restructuring is a crucial moment in the company’s evolution, paving the way ​for targeted innovation and long-term value creation.