The New Honeywell: Three Industry Leaders!

Honeywell (NASDAQ: HON) has announced a major corporate restructuring, with plans to separate its Automation and Aerospace divisions into independent, publicly traded companies. This move, along with the previously announced spin-off of its Advanced Materials division, will result in three specialized businesses—each focusing on distinct growth strategies and market opportunities. The restructuring is expected to be completed in the second half of 2026 and will be executed tax-free for shareholders.

Vimal Kapur, Chairman and CEO of Honeywell, emphasized the significance of this decision, stating:
“This transformation will establish three independent leaders, each positioned for targeted growth and innovation. By streamlining Honeywell’s structure, we are accelerating operational improvements and aligning our businesses with key industry trends such as sustainability, digitalization, and artificial intelligence.”

Honeywell Automation – Expected to generate $18 billion in revenue in 2024, this division will focus on driving the digital transformation of industrial sectors. By integrating process automation, software, and AI-driven solutions, it aims to enhance efficiency, productivity, and sustainability on a global scale.

Honeywell Aerospace – With $15 billion in projected revenue for 2024, this division will continue to be a key player in the aviation and defense sectors. It will concentrate on next-generation flight technologies, including electrification, autonomous aviation, and advanced defense systems, ensuring long-term innovation and leadership in aerospace.

Advanced Materials – Estimated to bring in $4 billion in revenue in 2024, this division will focus on sustainable specialty chemicals, electronic materials, and eco-friendly packaging solutions. Positioned to capitalize on global sustainability initiatives, it will drive breakthroughs in material sciences and environmentally responsible solutions.

Honeywell is actively deploying $25 billion toward capital expenditures, dividends, share repurchases, and acquisitions through 2025. Recent acquisitions, such as Access Solutions, Civitanavi Systems, CAES Systems, and Air Products’ LNG business, highlight its focus on expanding into high-growth markets. Additionally, the company plans to divest its Personal Protective Equipment business by mid-2025.

The spin-off of the Advanced Materials division is scheduled for completion by late 2025 or early 2026, while the full separation of Automation and Aerospace will be finalized in the second half of 2026, subject to regulatory approvals. Goldman Sachs & Co. LLC and Centerview Partners LLC are advising on financial aspects, while Skadden, Arps, Slate, Meagher & Flom LLP is providing legal counsel.