Textron plans to separate its Industrial segment as it moves to sharpen its focus on aerospace and defense businesses led by Textron Aviation, Bell and Textron Systems.
The company said it intends to shed its Industrial unit, which includes Kautex and Textron Specialized Vehicles, either through a sale or a tax-free separation into a standalone publicly traded company.
Textron said the move would leave the remaining company as a standalone aerospace and defense business built around Cessna and Beechcraft, Bell military and commercial rotorcraft, and Textron Systems’ defense and aerospace products.
The company referred to the post-separation aerospace and defense business as “New Textron,” though it did not say whether that would become the final company name.
“This planned separation creates greater clarity and focus for both businesses,” Textron CEO Lisa Atherton said. “New Textron will move forward as a pure-play aerospace and defense company positioned for higher growth, while Industrial gains the independence to pursue strategies aligned with its distinct strengths.”
Textron said the planned separation would give each business more flexibility to pursue its own capital allocation strategy, product development priorities and growth opportunities.
The company said the aerospace and defense business is expected to generate more than $12 billion in 2026 revenue and have $19 billion in backlog after the separation.
Textron said the remaining aerospace and defense company expects the separation to improve its revenue growth profile and operating margins. The company said it would continue to maintain a strong balance sheet and invest in research and development and capital expenditures.
Industrial is expected to generate more than $3 billion in 2026 revenue. The segment includes Kautex, which supplies plastic fuel systems, battery enclosures and clear-vision systems for the automotive industry, and Textron Specialized Vehicles, whose brands include E-Z-GO, PACE Technologies, Jacobsen and TUG Technologies.
Textron Executive Chairman Scott Donnelly said the company’s board and management team concluded that separating Industrial would sharpen Textron’s strategic focus and support long-term shareholder value creation.
Textron is targeting completion of the separation within 12 to 18 months. The company said the timing and structure remain subject to customary conditions, regulatory approvals and final board approval.