CEO Vimal Kapur, Facing Shareholder Pressure, to Split Honeywell into Three Companies
Vimal Kapur is a rare Indian CEO of a major global company, $136 billion Honeywell, without an MBA or an advanced degree
(Photo: Vimal Kapur, CEO, Honeywell.)
February 6, 2025
Honeywell International’s Board of Directors today announced plans to separate the company’s automation and aerospace technologies businesses, in addition to spinning out the advanced materials operations. This will result in the conglomerate, based in Charlotte, United States, being split into three separate public companies in the second half of 2026, assuming all regulatory and other approvals are complete.
"The formation of three independent, industry-leading companies builds on the powerful foundation we have created, positioning each to pursue tailored growth strategies, and unlock significant value for shareholders and customers," Vimal Kapur, Chief Executive of Honeywell said in a statement.
In 2024, Honeywell earned $7.3 billion in operating income on $39 billion in revenues. It has a market value of $136 billion.
Last year, the revenues of Honeywell Automation, the largest of the three divisions, totaled $18 billion. It serves the industrial infrastructure and buildings markets. Customers of industrial products are in the oil and gas, petrochemicals, life sciences, metals and mining, and other markets. Building products include software, security access solutions, and technologies to keep facilities safe and energy efficient.
Honeywell Aerospace’s products include aircraft propulsion, cockpit and navigation systems, and auxiliary power systems, used on virtually every commercial and defense aircraft platform worldwide. In 2024, the division earned $4 billion in operating profit on $15.5 billion in revenues.
Honeywell Advanced Materials, with nearly $4 billion in revenues in 2024, focuses on specialty chemicals and materials. Products include fluorine-based materials, electronic materials, industrial grade fibers, and healthcare packaging solutions.
"The enhanced focus, alignment, and strategic agility enabled by this separation will allow Honeywell to realize the opportunity for operational improvement and valuation upside,” Elliott Investment Management partners Marc Steinberg and Jesse Cohn said in a statement.
In November 2024, in a letter to Honeywell’s board, Elliott stated that it “believes a separation of Aerospace and Automation would result in share-price gains of 51% – 75% over the next two years.” The West Palm Beach, Florida, based activist investment firm announced that it had made an “investment of more than $5 billion in Honeywell.”
“Honeywell is an iconic pillar of the American industrial complex and remains a world-class company with market-leading assets,” Elliott’s letter stated. “But uneven execution, inconsistent financial results and an underperforming share price have diminished the Company's strong record of value creation over the last five years. The conglomerate structure that once suited Honeywell no longer does, and the time has come to embrace simplification.”
Vimal Kapur, 59-years-old, has been CEO of Honeywell since 2023. Earlier he was the president and chief operating officer. During 2021-2022, as CEO of the company’s Performance Materials and Technologies division he boosted revenues and profits and established the sustainable technologies solutions business that produces many of the technologies necessary for the energy transition.
While leading the Building Automation division, 2018 – 2021, the business took share from competitors and significantly expanded profit margins during a global pandemic. Previously, Kapur served as President of Honeywell Process Solutions, which he led through an oil and gas downturn, positioning it to emerge as an even stronger competitor.
Honeywell is using Artificial Intelligence (AI) to enhance the skills of technicians and pilots as well as to monitor the performance of engines and smoke detectors, Kapur said at a CNBC AI summit in New York City, in October. He noted that, “There is always a trend which makes your skills obsolete, every five years.”
Kapur though is a rare executive who managed to stay on at the same American company, Honeywell, for 36 years, as well as climb to the top of the corporate ladder. In 1989, he started his career at a Honeywell joint venture in India. He later became the Managing Director of Honeywell Automation India, before moving to Honeywell’s U.S. operations.
Kapur is also a rare Indian CEO of a Fortune 500 company, or even a rare Indian senior executive of a major American business, without an MBA, or an advanced degree, or even a degree from a U.S. university. He graduated from the Thapar Institute of Engineering, Patiala, India, as an electronics engineer.
in 2023, as Honeywell CEO, Kapur earned $14.4 million in salary and stock; and in 2022, $8.4 million. He also owns Honeywell stock currently worth about $38 million.
In 2024, Honeywell's backlog grew 11% to a record $35.3 billion. Honeywell remains on pace to exceed its commitment to deploy at least $25 billion toward high-return capital expenditures, dividends, opportunistic share purchases and accretive acquisitions through 2025. The company intends to continue its portfolio transformation efforts during the separation planning process to enhance the value proposition of each business.
CEO Kapur said in a statement, "Our simplification of Honeywell has rapidly advanced over the past year…and we plan to continue deploying capital to further enhance each business as we prepare them to become leading, independent public companies."