Textron plans to separate its Industrial business from its aerospace and defence operations as the company moves to sharpen its focus around aviation and military manufacturing.

The company is considering several routes for the separation, including a sale or a tax-free split into a standalone publicly traded company. The move would leave Textron centred on Textron Aviation, Bell and Textron Systems.

Following the separation, New Textron is expected to have more than $12 billion in 2026 revenues and a $19 billion backlog. Its main businesses would include Cessna and Beechcraft aircraft, Bell military and commercial rotorcraft and Textron Systems’ aerospace and defence products and services.

“This planned separation creates greater clarity and focus for both businesses,” says Lisa M. Atherton, chief executive officer at Textron. “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—unlocking long term value for all stakeholders.”

Industrial is expected to have more than $3 billion in 2026 revenues. It includes Kautex, which makes plastic fuel systems, battery enclosures and clear-vision systems, as well as Textron Specialized Vehicles, whose brands include E-Z-GO, PACE Technologies, Jacobsen and TUG Technologies.

Textron expects each business to benefit from greater strategic flexibility, clearer capital allocation and management teams focused on their own markets.

The company is targeting completion within 12 to 18 months, subject to regulatory approvals, final board approval and other customary conditions. Goldman Sachs is acting as financial adviser and Latham & Watkins is acting as legal adviser.