Treasury Today’s Top Treasury Team 2019 Winner: Honeywell

Published: Jul 2019


Photo of Jim Mahn, Citi, Cara Savas, HSBC, Didier Vandenhaute, PwC, Ans Michiels, Deutsche Bank, Sabry Salman, Barclays, Marie-Astrid Dubois, Rónán Clifford, Gino Gude and Séverine Le Blévennec, Honeywell.

Jim Colby

Vice President and Treasurer

Marie-Astrid Dubois

Assistant Treasurer


Honeywell is a Fortune 100 software-industrial company that recorded US$41.8bn in sales in 2018 and does business in more than 970 sites around the world.

in partnership with

How treasury helped carve out two independent global companies, with a combined revenue of US$8bn, in just nine months

Honeywell treasury, in conjunction with key stakeholders and banking partners, carved out two independent companies with a combined revenue of US$8bn within nine months. In doing so, it created two new treasury structures from scratch. It deployed the latest technology, pioneering the introduction of eSignature, the early adaption of client on-boarding tools and communicated globally via cloud technology.

All this was achieved whilst ensuring the remaining Honeywell business operated as normal and with no disruption to the existing businesses while they were being spun off from Honeywell.

During this period, treasury was also involved in repatriating US$5bn, which impacted 15 countries and involved complex tax steps and weekly calls. In addition, it had to perform due diligence, fund and integrate a newly acquired business (Transnorm, a circa €430m acquisition closed in November 2018).

On manoeuvres

In 2018, a strategic decision was made to carve out the Honeywell ‘turbo’ business and form a new standalone company called Garrett Advancing Motion (GTX). In parallel, another standalone, Resideo (REZI), was created from its ‘homes’ related portfolios. At the time of the spinouts, the business relating to what would become GTX had a turnover of around US$3bn. The business that would become REZI turned over about US$4.5bn.

Both spinouts were quite complex. GTX operates in 24 countries, in 17 different currencies; REZI in 33 countries and 21 currencies. Both businesses were fully integrated within Honeywell’s advanced liquidity and cash management structures and intercompany loan portfolio, as well as using Honeywell trade finance lines with company parent support. The businesses were directly integrated with other Honeywell business units where they might have shared bank accounts.

Treasury was charged with creating the necessary treasury structures without having the new senior leadership, nor a treasury team, in place to provide clear guidance of what the required future end-state would be for either new company. Yet the team had a hard deadline to make both businesses fully independent and operational within just nine months.

Team talk

Honeywell treasury consisted of 30 treasury professionals (11 in the US, 11 in EMEA and eight in APAC). Its role was fundamental to the success of creating these two new publicly quoted independent companies. It was a global team effort, working together under the spirit of a ‘One Honeywell’ mindset.

Cutting edge technology was used, implementing eSignature solutions with several of its banks (it was the first corporate to do so with Barclays in EMEA and J.P. Morgan in the US). This sped up processing times of a multitude of banking documents.

Onboarding platforms were piloted, assisting with the overall KYC process. Again, Honeywell was amongst the first large corporates to use Barclays’ Boost platform, working closely with its development team to address bugs and improve efficiency. The team was thus able to expedite account opening processes in some countries. It also leveraged cloud technology, ensuring all relevant stakeholders were kept abreast of all treasury activity via secure and flexible cloud-based trackers.

Treasury worked closely with its core banking partners, holding several workshops to understand the global KYC requirements of each. With Deutsche Bank, it established a EUR cash sweep across ten countries, and two-way sweeps with four banking groups (Deutsche Bank, BNP Paribas, Danske Bank and Citi).

Six sigma methodology was used to engineer processes and procedures that were appropriate for both businesses. The cloud-based trackers were used to inform all key stakeholders globally of progress, as well as the transfer of sensitive information like bank account details, cash balances and new intercompany loan portfolios.

The methodology ensured core business requirements were met, and that both GTX and REZI went live as fully independent companies as communicated to the market by its worldwide CEO and President.


The magnitude of the undertaking performed by Honeywell treasury over the nine months it took from inception to spin date, underscores the impressiveness of its achievement.

With a deadline imposed by senior leadership – approximately nine months to achieve both goals – a deal cut-off was agreed with the regulator and communicated to market. The dates were thus set in stone. Treasury attended numerous spin team-calls, per country, per tax plan, and for the overall project.

Communication across multiple time zones was required on a regular basis with tax (for tax planning), legal (creating the new entities), controllership (integrating a new system), and finance teams (regarding the payments infrastructure).

A detailed Treasury Service Agreement (TSA) was developed to support both businesses during an agreed-upon transition phase. This was equally iterative, simultaneous (covering scoping, demerger, tax planning, treasury structure, funding and e-banking set-up), and complex.

Executing two simultaneous spins in such a short time-frame was one of the most challenging assignments of my career. To seamlessly meet this challenge was only possible by having a dedicated, experienced, talented global team that worked tirelessly and effectively with the businesses and other corporate functions as One Honeywell. Having our work recognised by winning the Adam Smith Top Treasury Team award gives me a tremendous amount of pride and emphasises Honeywell Treasury as #FutureShapers.

Jim Colby, Vice President and Treasurer, Honeywell

Initially the bank account landscape was unclear, as the new CEO and treasury weren’t hired until further into the project, meaning a slight delay in finalising partner-banks of the spin-offs.

However, multiple legal steps around entity creation had to be completed prior to opening new bank accounts, then the team needed to create new e-banking instances for each bank involved. A post-spin administrator was assigned, training organised and users assigned to the existing and new e-banking instances in accordance with the TSA.


In terms of cash visibility and forecasting, newly-created bank accounts were set up following both Honeywell processes and the post-spin set up, doubling the work. A solution had to be found for the future state; with GTX using Deutsche Bank and REZI using J.P. Morgan, a bank consolidator was considered.

To ensure payment continuity during the transition period, full cash visibility was needed, including the ZBA cash-pool balances, and a cash forecast for each spin-off account. This needed to take into account the funding step plan being implemented and the moving of the liquidity structure. Forecasting was essential post-spin to allow the new treasury teams time to stabilise.

When it came to payments and netting, the team had to disconnect entities from the Honeywell payment structure but ensure continuity of payments. New payment methods and connections for the spin-off had to be formed, and new contracts prepared for separate netting instances with BMG. Entities and users had to be linked to the new system and delinked from Honeywell’s. Also, netting groups were adapted, reflecting the new cash pool structure, to support cash flow forecasting.

For the funding and liquidity structure and intercompany loans, it was necessary to engineer new cash pool structures. This saw the new entities delinked from the existing Honeywell liquidity structures. Then, revolving credit facilities and long-term financing structures (USD and EUR) were established. As publicly-listed companies, both GTX and REZI needed to obtain a rating and submit SEC filings.

It is essential to ensure funding at all times, keeping within approved investment limits. It was decided to eliminate all intercompany loans between Honeywell and the spin-offs, before establishing new intercompany loans according to funding needs for both businesses.

New FX risk management processes required separate exposures and hedges from the new entities, with LEIs sought and post-spin EMIR reporting capabilities required for both. It was decided to stop creating internal hedges with Honeywell entities, instead setting up external hedges or internal hedges within the spin-off scope.

All corporate guarantees impacted by the process were listed. It was decided to recall/renew Honeywell corporate guarantees at the spin-off date in order to exclude the new entities.

A new spin-off head office was formed to issue corporate guarantees for spin-off banking partners. A list was created of all bank guarantees issued by mixed entities, to see whether guaranteed contracts related to Honeywell or the spin-off. Then, trade lines were established, allowing GTX and REZI to issue bank guarantees.

New tech

As the first corporate to use eSignatures with Barclays in EMEA and with J.P. Morgan in the US, it acted as a catalyst in accelerating its adoption amongst corporates globally.

The team also leveraged early adoption of banking online KYC portals, such as Barclays’ BOOST platform. During this pressurised period, it had direct access to Barclays’ developers, working closely on improvements, helping to deliver a more robust and user-friendly system. The feedback resulted in weekly patches being pushed to the platform, allowing treasury to operate more effectively as it underwent onboarding with the bank.

Cloud technology was adopted, allowing the sharing of important trackers, ensuring all stakeholders were kept abreast of progress and for relevant information to be distributed. As a global project, the ability to access real-time information allowed treasury to be very agile, operating across time zones.


Relationship management with key banking partners proved vital. The workshops held with these banks helped all parties stay aligned on every aspect of the project. In being able to either pilot new technologies or be early adopters it gave the banks invaluable live client experience in which to test their tools.

Given Honeywell’s strong relationships with its banking partners, cross-banking group project teams were set up to ensure that cross-border/cross-bank sweeping was established and that all partners worked to achieve a common goal. It paid off. With 100% cash-visibility from day one, across all bank accounts, it was possible to clearly segregate what cash belonged to Honeywell, and what belonged to GTX and REZI (the adaption of the Quantum TMS further allowed instant reporting and the isolation of key data at a Honeywell, GTX or REZI level).


This monumental reorganisation let Honeywell place a greater focus on its four remaining divisions, which was a key strategy of its CFO and president. The speed of execution allowed both businesses to stand alone successfully within the published timeline.

The whole process leveraged the expertise of the team, rather than outsourcing it to consultants. Many balls were in the air at the same time, but due to the commitment and expertise of the team, none were dropped.

This impressive feat demonstrates how treasury brings real value to achieving and supporting global business goals. It also reveals the level of skill and involvement required to be the Adam Smith Awards Top Treasury Team 2019.

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