Honeywell Announces Plans to Spin Off Automation and Aerospace Businesses, Creating Three Independent Companies
Honeywell International Inc. revealed today its intention to spin off its automation and aerospace businesses into separate entities. This move, combined with the previously announced spin-off of its Advanced Materials division, will result in three distinct, publicly traded companies, each with its own strategic direction.
The Charlotte, N.C.-based conglomerate aims to finalize the separation of its automation and aerospace businesses by the second half of 2026. The Advanced Materials business is expected to complete its spin-off earlier, by the end of 2025 or early 2026.
Vimal Kapur, Honeywell’s Chairman and CEO, emphasized the strategic rationale behind the decision: “By creating three independent, industry-leading companies, we are building on the strong foundation we’ve established. This will enable each business to pursue tailored growth strategies and unlock significant value for both shareholders and customers.”
Kapur added, “Over the past year, we’ve made substantial progress in simplifying Honeywell’s structure. We will continue to refine our portfolio to drive further shareholder value. With a robust pipeline of strategic bolt-on acquisition opportunities, we plan to deploy capital strategically to strengthen each business as they transition into leading, independent public companies.”
Honeywell highlighted several advantages of the spin-offs, noting that each new company will benefit from a clearer strategic focus and enhanced financial flexibility. This will allow them to capitalize on organic growth opportunities and align capital allocation with their specific priorities. Additionally, the spin-offs will feature dedicated boards of directors and management teams with deep industry expertise, enabling them to better serve their stakeholders.
The company also emphasized that the separation will create distinct investment profiles for each entity, positioning them to deliver unique long-term value. By operating as independent companies, Honeywell’s automation, aerospace, and advanced materials businesses will be better equipped to innovate, compete, and thrive in their respective markets.
This strategic restructuring marks a significant step in Honeywell’s ongoing transformation, as it seeks to maximize value creation and drive sustainable growth across its diverse portfolio.
Previewing Honeywell’s Future: Automation, Aerospace, and Advanced Materials
Following the completion of its planned spin-offs, Honeywell Automation will shift its focus from automation to autonomy. The new company will deliver cutting-edge hardware and software solutions designed to enhance productivity across key industries such as manufacturing and logistics. With an estimated 2024 revenue of $18 billion, Honeywell Automation will leverage its global scale to connect assets, people, and processes, driving digital transformation for its customers. Building on decades of technological leadership, deep industry expertise, and a vast installed base, the company aims to serve high-growth verticals with innovative solutions.
Honeywell Aerospace, already a dominant player in the aviation industry, boasts technology deployed on nearly every commercial and defense aircraft platform worldwide. Its portfolio includes advanced aircraft propulsion systems, cockpit and navigation technologies, and auxiliary power systems. With $15 billion in annual revenue in 2024 and a substantial global installed base, Honeywell Aerospace is poised to become one of the largest pure-play aerospace suppliers in the public market.
Meanwhile, Honeywell’s Advanced Materials division will emerge as a sustainability-focused leader in specialty chemicals and materials. The company holds strong positions in fluorine products, electronic materials, industrial-grade fibers, and healthcare packaging solutions. In 2024, Advanced Materials generated nearly $4 billion in revenue, driven by innovative offerings like its Solstice hydrofluoro-olefin (HFO) technology, which helps reduce global warming impact. As a standalone entity with a robust domestic manufacturing base, Advanced Materials is expected to benefit from a compelling investment profile and a more flexible, optimized capital allocation strategy.
Honeywell aims for organic growth and a simplified portfolio
Since December 2023, Honeywell has announced several strategic actions to drive organic growth and simplify its portfolio. This includes approximately $9 billion of accretive acquisitions: the Access Solutions business from Carrier Global, Civitanavi Systems, CAES Systems, and the liquefied natural gas (LNG) business from Air Products.
In addition, the company entered into an agreement to divest its Personal Protective Equipment business, which is expected to close in the first half of 2025. Honeywell said the breakup will happen a manner that is tax-free to Honeywell shareholders.
The company is continuing to execute its previously announced spin-off of its Advanced Materials business. It expects to complete this by the end of 2025 or early in 2026. Honeywell said the three independent companies will be appropriately capitalized with the financial flexibility to take advantage of future growth opportunities. It said it expects Honeywell Automation and Honeywell Aerospace to each maintain a strong investment-grade credit rating.