Industrial goods giant Honeywell (IW1000/105) said on May 12 that it plans to spin off its resins and chemicals business to focus on building growth through high-value software and technology products.
Just months after Honeywell abandoned a $90 billion takeover bid for United Technologies after repeatedly being rebuffed, the company announced the spin-off, which will create a publicly traded company named AdvanSix Inc.
The new standalone company will represent Honeywell's resins and chemicals business, which had $1.3 billion in revenue in 2015, the Morris Plains, New Jersey-based company said.
"Today's announcement represents another step in the evolution of the Honeywell portfolio," said David Cote, chairman and chief executive.
"We continue to focus on driving breakthrough growth through advanced software capabilities and technology differentiation, with high-value product offerings that help us to win in the marketplace."
Honeywell, with businesses including aerospace and defense, automation and industrial controls, said the spin-off was expected to be completed by early 2017, subject to regulatory and shareholder approvals.
It highlighted that AdvanSix will be a global leading manufacturer of Nylon 6, a polymer resin used to produce engineered products such as plastics, fiber and film that are used in making a range of end products, from automobiles and electronic components to food and industrial packaging.
The company also said the deal would create added value for Honeywell shareholders, who will receive AdvanSix shares tax-free.
In early March Honeywell announced it had pulled its $90 billion takeover offer for United Technologies due to its unwillingness to engage in negotiations.
United Technologies, whose businesses include Pratt & Whitney aircraft engines, Otis elevators and heating and climate control products, had said Honeywell's offer grossly undervalued the company.
Copyright Agence France-Presse, 2016