Honeywell International (Honesty) stocks jumped to a record high on Tuesday after Elliott Investment Management said it has acquired a position worth more than $5 billion in the industrial conglomerate and is seeking to split the company.

Elliott said in a statement that it sent a letter to Honeywell’s board of directors requesting the separation of the aerospace and automation businesses as standalone companies.

The hedge fund said it believed such a separation of the two companies would result in a share price rise of between 51% and 75% over the next two years as they would benefit from more focused management and of a simplified structure.

“The conglomerate structure that once suited Honeywell is no longer suitable, and now is the time to embrace simplification,” Elliott said, noting that “uneven execution, inconsistent financial results and an undervalued stock price performance have diminished the company’s strong history of value creation over the past few years. last five years. »

Honeywell, one of the few American conglomerates not yet separated

Honeywell is one of the few industrial conglomerates that has yet to be broken up, although it announced plans to break it up last month. rationalize your activity and spin off its advanced materials division.

Other high-profile industrial conglomerates have seen their shares soar after their dissolution.

at General Electric threesome breakup was completed in April this year, for example, and shares of its standalone companies have surged, with that of power generation company GE Vernova (GEV) the stock has more than doubled this year.

Bloombergwhich previously reported on Elliott’s position in Honeywell, said the hedge fund’s stake was one of its largest ever investments in a company. He also noted that Elliott is now one of Honeywell’s top five shareholders.

Honeywell, based in Charlotte, North Carolina last month reported quarterly sales below estimates and reduced his income guidance as demand for its industrial automation products fell.

Honeywell shares are up 4.6% as of Tuesday morning and more than 12% this year.