Honeywell Aerospace CEO Jim Currier, whose aerospace and defense spinoff began trading on its own Monday, offered another eulogy for the conglomerate model.
The sector-spanning corporate empire is “outdated,” Currier told Semafor, reflecting on a past generation of investors that were less sophisticated, had fewer tools like ETFs and prediction markets, and relied on managers to diversify for them. He spoke of the “subpar decisions to placate individual businesses,” with capital deployed accordingly in equally puzzling ways. (Investors make their own allocation decisions; Honeywell Aerospace ended its first trading day down 3%.)
Currier said the company is now free to direct its focus and capital on the “singular strategy” of making mission-critical hardware for global commercial and defense customers.
M&A is on the horizon, Currier said, though it might take a minute as the company works through a pile of debt it took on as part of the spinoff, partly to pay a $10.5 billion dividend back to its former parent, Honeywell International. The company says it has plenty of cash coming in and a $19 billion backlog that’s growing 20% annually.