Honeywell to spin off its aerospace and automation businesses

Industrial and technology conglomerate Honeywell is set to break itself apart into three separate listed entities. 

Under this plan, Honeywell’s aerospace and automation divisions will each become an independent business. Honeywell will also move ahead with the spinoff of its advanced materials division, which was already slated to take place. In addition, Honeywell has an energy and sustainability solutions business. 

The move has been instigated by activist fund Elliott Management. This investment firm purchased $5 billion worth of Honeywell stock back in November 2024 with the declared purpose of pushing for a break-up of the company.  

At the time of the share purchase, Elliott Management stated that it considered Honeywell’s performance to be suffering from an over-complex structure and poor management, which had led the stock to underperform compared to its industry peers. 

Honeywell is a major player in the aerospace sector. Its aviation division, called Honeywell Aerospace Technologies, develops and manufactures a broad range of systems used in civilian and military aircraft, at airports and across several other areas of the industry, such as air traffic control and safety.  

These include engines for fixed-wing aircraft and rotorcraft, avionics, communications and vision systems, auxiliary power units (APUs), airport and air traffic management systems, aircraft brakes and even the black boxes where flight data is recorded. 

The aerospace business is also the largest of Honeywell’s divisions, generating around 40% of the group’s revenue of US$28.4 billion in 2024.  

Together with investment bank Goldman Sachs, Honeywell has been working on a plan to spin off its business units since at least December 2024. Analysts quoted by several media outlets estimate that as an independently listed company, Honeywell’s aerospace business could be valued somewhere in the region of $100 billion. 

Here Honeywell is following in the footsteps of GE, another major US conglomerate with interests in the aerospace sector, which spun off its aero engine business, GE Aerospace, in 2024. 

Honeywell’s stock dropped 4.4% on February 6, 2025, after the company announced its break-up and a lower-than-expected earnings forecast for 2025. 

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