Honeywell International Inc. Chief Executive Officer Dave Cote made the biggest management changes of his 12-year tenure, picking two vice chairmen to speed acquisitions and raise the role of software across the company.
The manufacturer named Roger Fradin, 60, vice chairman to pursue $10 billion in acquisitions, and Andreas Kramvis, 61, was appointed vice chairman in charge of the company’s software initiative. Both positions are newly created, Morris Township, New Jersey-based Honeywell said in a statement.
“Those are all very good moves as they think about how to drive to their new five-year targets,” Steve Winoker, a New York-based analyst with Sanford C. Bernstein & Co., said in a telephone interview. “Honeywell has elevated its game here over the last decade and it’s evident by the moves today.”
Honeywell fell 1.5 percent to $91.90 at the close in New York while the Standard & Poor’s 500 Index dropped 1.1 percent.
After becoming CEO in 2002, Cote, 61, has cut costs and shed lagging businesses while focusing on energy services and aerospace to increase profits. The company announced this year a plan to raise profit margins in line with peers and grow through acquisitions by 2018.
Honeywell also appointed Tom Szlosek as chief financial officer, replacing Dave Anderson, 64, who is retiring. Alex Ismail was named to the head of the Automation and Control Solutions unit in place of Fradin. Darius Adamczyk takes over the Performance Materials and Technologies unit, where Kramvis was CEO.
Anderson, who became CFO in 2003 at a time when Honeywell often missed earnings targets, “has been instrumental in reestablishing credibility with investors, alongside CEO Dave Cote,” Nigel Coe, an analyst with Morgan Stanley, said in a note today.
Fradin doubled the Automation and Control Solutions business to $17 billion in sales during his 10 years as chief in part through acquisitions. Kramvis posted 30 percent growth since becoming head in 2008 of the unit that makes chemicals and provides technology to energy companies.
In a March investor meeting, Cote set a goal of more than doubling five-year spending on acquisitions to drive sales to as high as $59 billion by 2018.
Kramvis will be charged with improving the productivity and quality of software development, which Cote called in the March meeting the “most consistent critical component of every single thing we do.” Kramvis also will oversee Honeywell’s efficiency program, which has driven margin gains.