Honeywell to break itself up in three-way split
By Abigail Townsend
Date: Thursday 06 Feb 2025
(Sharecast News) - US industrial conglomerate Honeywell is to break itself up, it was confirmed on Thursday, following pressure from activist investor Elliott Investment Management.
The Nasdaq-listed firm said it would separate its aerospace division from its automation business, while simultaneously proceeding with a previously announced spin-off of its advanced materials unit.
All three businesses will be listed on the New York Stock Exchange.
Vimal Kapur, chief executive, said: "The formation of three independent, industry-leading companies builds on the powerful foundation we have created, positing each to pursue tailored growth strategies and unlock significant value for shareholders and customers."
The move follows pressure from Elliott, which took a $5bn position last November. It believes Honeywell's unwieldy conglomerate structure has weighed on both results and the share price.
In a statement on Thursday, Elliot said: "The enhanced focus, alignment and strategic agility enabled by this separation will allow Honeywell to realise the opportunity for operational improvement and valuation upside.
"We look forward to supporting Vimal and the management team as they execute on the separation."
The break-up is expected to complete by the second half of 2026.
As at noon GMT, shares in Honeywell - which has a market valuation of around $145bn - were down 4% in pre-market trading.
The company also announced forecast-beating fourth-quarter numbers on Thursday. Sales reached $10.1bn, up 7% year-on-year, while adjusted earnings per share were $2.47. Analysts had forecast EPS of $2.33 and sales of $9.97bn.
However, its forecast for adjusted EPS of between $10.10 and $10.50 in 2025 missed analyst hopes for $10.93 per share.
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