Honeywell unit gets high marks from CEO
Division is being considered for spinoff
• Honeywell International’s aerospace business, now under review as part of a proposal to spin off the unit, has performed well and has benefited from heavy investment from the U. S. technology and manufacturing company, executive chairman David Cote said on Monday.
Honeywell said in May it would decide by this fall whether to separate the aerospace business, which makes auxiliary power units and engines for aircraft.
“The business has actually performed pretty well,” said Cote in an interview on the sidelines of the International Economic Forum of the Americas in Montreal.
“And if you take a look at margin improvement and you take a look at the wins that we’ve had over a long period of time since 2013. We’ve invested very heavily in that business.”
Hedge f und i nvestor Third Point LLC has argued in favour of the spinoff, which it said could create more than US$ 20 billion in shareholder value. The business is Honeywell’s biggest, generating US$ 14.75 billion in sales last year.
Cote said Honeywell chief executive Darius Adamczyk is now reviewing the unit with the company’s board and there would be discussions held with investors at some point.
“I can promise you that whatever Darius does, it’s going to be consistent with ‘ how do you keep growing that overall return for our shareholders,’” he said.
Cote also said he does not agree with President Donald Trump’s decision to take the United States out of the 2015 global Paris agreement to fight climate change.
While the decision would erode t he ability of t he United States to influence other countries, it will not stop America from achieving its own emissions’ reductions goals, in part because of the conversion from coal to natural gas use, he added.
“I would have preferred that we not do it, but I don’t think it’s catastrophic,” Cote said.