Honeywell Plans to Split into Three Companies After $5 Billion Push from Investors

In a big shake-up, Honeywell International Inc. will break into three separate companies. The decision follows pressure from Elliott Investment Management, which holds a $5 billion stake.

The board moved forward after Elliott showed the split could drive share prices up 51% to 75% within two years. This is a big change for the 117-year-old company, which is now following other industrial giants making similar moves.

The split will create three independent businesses. One will handle aircraft parts and engines, another will focus on industrial controls, and a third will produce advanced materials. This follows the path taken by GE and Emerson Electric recently.

The aircraft division still faces supply chain problems, even as airplane manufacturers ramp up production. They make essential parts, from jet engines to the systems pilots use in cockpits.

Investment firm Elliott supports the company's plan. "The portfolio transformation led by CEO Vimal Kapur and his team represents the right course for Honeywell," said Elliott to AInvest.

This marks Elliott's biggest win yet, considering both company size and investment amount. It shows how investors are reshaping how manufacturing companies organize themselves.

With most decisions now made, the board will reveal details when fourth-quarter results come out. GE kicked off this trend in 2021 by announcing its own three-way split.