Honeywell became the latest industrial giant to carve off its aerospace arm, signaling a broader trend of conglomerates shedding units to boost shareholder value. The three billion dollar windfall for investment banks advising on these splits underscores the financial incentives driving the trend. While BASF continues shedding divisions to focus on chemicals, Kraft Heinz remains stalled, highlighting the complexity of untangling sprawling portfolios.

The core argument against conglomerates—that they trade at discounts due to inefficient management and opaque valuations—gains fresh urgency as technology erodes once-promising synergies. Siemens offers a success story, with margins rising sharply since its 2018 divestitures, while Hershey benefits more from falling cocoa prices than peers like Mondelez. The challenge lies in identifying truly valuable assets; Berkshire Hathaway thrives as an exception, and private equity firms now often acquire the very businesses conglomerates offload.