Key Takeaways
- The board of Honeywell has finalized approval for spinning off its aerospace unit, scheduled for June 29
- Shares of HON climbed approximately 4% during Monday’s morning session following the announcement
- Investors holding shares as of the June 15 record date will be granted one HONA share per two HON shares owned
- Following the separation, the core business will adopt the name Honeywell Technologies while maintaining the HON ticker symbol on Nasdaq
- A 1-for-2 reverse stock split for Honeywell Technologies is planned to execute right after the division
The board of directors at Honeywell International (HON) has granted final authorization for the spin-off of its aerospace operations, confirming June 29 as the official separation date.
Honeywell International Inc., HON
Shares of HON advanced roughly 4% during Monday’s early trading hours in response to the development. The stock received additional momentum from a wider market upswing driven by reports of a peace agreement between the United States and Iran.
The board’s formal authorization of distributing Honeywell Aerospace (HONA) shares to current stockholders marks a significant step in the corporate restructuring strategy the industrial conglomerate announced earlier in the year.
Following completion of the separation, the continuing entity will adopt the name Honeywell Technologies and retain its listing on Nasdaq under the HON symbol. The independent aerospace entity, trading as HONA, will concentrate on commercial aviation, defense systems, and space industry segments.
Investors whose ownership is recorded on June 15 will be entitled to one share of Honeywell Aerospace for each pair of Honeywell shares in their portfolio. The actual distribution will occur at 12:01 a.m. New York time on June 29.
Trading for Honeywell Aerospace shares on a when-issued basis under the temporary ticker HONAV is anticipated to commence around June 15. Standard trading under the permanent HONA ticker begins on June 29.
Dual Trading Structure Ahead of Split
In the period before the corporate separation, HON will operate in two distinct trading categories. Shares purchased under the HON symbol will include entitlement to receive HONA shares. Trading under the temporary HONIV ticker will exclude these distribution rights.
Chief Executive Officer Vimal Kapur characterized the board’s decision as an important progression in the company’s strategic portfolio reshaping, which has featured numerous acquisitions and asset sales over recent years.
The company has also verified that a 1-for-2 reverse stock split affecting Honeywell Technologies will be implemented immediately following the spin-off, accompanied by a proportional decrease in the authorized share total. This reverse split is contingent upon the successful completion of the separation.
What Jim Cramer Said
CNBC’s Jim Cramer has been outspoken in his support for the transaction. His Charitable Trust maintains a stake in HON, and he’s expressed interest in increasing that position.
“I think this is the kind of company that is not expensive, that has a great growth path,” Cramer remarked. He indicated his intention to retain ownership of both entities following the split.
Cramer has drawn parallels between Honeywell’s corporate restructuring and DuPont’s breakup, arguing that investors have yet to fully recognize the value creation potential. “People don’t respect Honeywell; they don’t respect it, and they’re making a very big mistake,” he stated.
The Securities and Exchange Commission declared Honeywell Aerospace’s Form 10 registration statement effective on June 11, removing the final regulatory obstacle for the transaction to proceed.
