One of America’s Last Major Industrial Conglomerates to Break Itself Into Three Separate Companies

Iconic American manufacturer Honeywell plans to break itself into three separate, publicly traded companies, aiming to streamline operations and address longstanding shareholder pressure.

Key Facts:

Honeywell will spin off its aerospace and automation divisions, as well as the advanced materials unit it had previously announced.
Elliott Management, an activist investor with a $5 billion stake, encouraged a more significant split.
Honeywell’s shares slipped over 2% in premarket trading after the company shared a lower-than-expected forecast for 2025.
The aerospace unit, which has contracts with Boeing and Airbus, accounts for about 40% of Honeywell’s revenue.
Honeywell expects to complete these separations in the second half of 2026.

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The Rest of The Story:

For many years, Honeywell stood out as one of America’s last major industrial conglomerates.

Now, it follows in the steps of 3M, General Electric, and United Technologies, which have all moved to split their businesses in an effort to appeal to investors seeking clearer focus and higher returns.

The company’s aerospace segment has been especially profitable, helped by a market that needs to keep older planes flying due to new aircraft shortages.

Honeywell also holds key U.S. government contracts, providing a wide range of services such as communication and navigation systems.

Elliott Management, led by Paul Singer, pushed for this move, noting Honeywell’s underperformance relative to the broader stock market.

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Despite attempts to restructure on a smaller scale, the pressure to break apart fully persisted.

In 2017, the company faced similar demands from another activist fund but managed to avoid a complete split.

This time, Honeywell decided it was best to separate three major divisions to streamline operations and potentially unlock more value for investors.

However, the announcement came with a disappointing forecast for 2025: projected sales between $39.6 billion and $40.6 billion, below analysts’ estimates, and an adjusted profit range of $10.10 to $10.50 per share.

Honeywell is preparing a three-way split, separating its aerospace division from its automation business and moving ahead with plans to spin off its advanced-materials arm https://t.co/7Iudfrl85v

— WSJ Business News (@WSJbusiness) February 6, 2025