Honeywell to Decide on Aerospace Spinoff by the Fall
May 23 2017 - 10:27AM
Dow Jones News
By Thomas Gryta
Honeywell International Inc. will decide whether to break off
its aerospace division by the fall, the company said Tuesday, and
it continues to work with advisers after activist Third Point LLC
made a public push last month for a spinoff.
The division, Honeywell's largest, supplies parts for Airbus SE
and Boeing Co. jets along with engines for aircraft made by
Bombardier Inc., and Textron Inc. and others. In a letter to
investors a month ago, Daniel Loeb's Third Point wrote that the
business has lagged behind its peers and separating it "would
result in a sustained increase in shareholder value in excess of
$20 billion."
In slides posted before Honeywell's presentation at the
Electrical Products Group conference in Florida, the company said
it is "modeling various scenarios" as part of the review.
Separately, it highlighted that Honeywell shares have outperformed
rivals and the aerospace division is positioned for "sustainable
growth" and margin expansion.
The activist push came just a few weeks after Honeywell switched
leaders as Darius Adamczyk took over as Honeywell's CEO from
longtime leader David Cote. Mr. Cote remains the company's
chairman.
The company, which has a market value of roughly $100 billion,
makes everything from aircraft landing gears to home thermostats.
The aerospace business accounts for about 38% of its $39.3 billion
in annual sales.
Honeywell shares have gained nearly 14% so far this year.
Write to Thomas Gryta at thomas.gryta@wsj.com
(END) Dow Jones Newswires
May 23, 2017 11:12 ET (15:12 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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