ITT Corp. plans to spin off two of its business divisions this year to create three publicly traded standalone companies. The engineering and manufacturing company and defense contractor has about 300 employees at its White Plains headquarters and some 40,000 employees worldwide.
Officials at ITT headquarters said the company”™s board of directors approved the plan to execute tax-free spinoffs to shareholders of ITT”™s water-related businesses and its defense and information solutions segment. After the spinoffs, ITT will continue to trade on the New York Stock Exchange as an engineering provider in the aerospace, transportation, energy and industrial markets. ITT shareholders will own stock in all three corporations.
ITT officials said they expect to complete the separation before the end of this year. The transaction is subject to regulatory approvals but does not require a shareholder vote.
Revenue in 2011 for the future ITT Corp. is projected at $2.1 billion. Projected revenue is $3.6 billion for the standalone water technology business in 2011 and $5.8 billion for the new defense and information solutions business.
Steven R. Loranger, ITT Corp. chairman, president and CEO, in a statement said the spinoff strategy will leave each company “more nimble and able to build stronger, more intimate customer relationships to accelerate mutual success.”
With the spinoffs, Loranger will serve as executive chairman of the rebranded water technology business. Denise Ramos, ITT”™s current chief financial officer, will become CEO of the new ITT Corp. Gretchen McClain, currently president of ITT”™s fluid and motion control division, will be CEO of the water technology corporation. David Melcher, current president of ITT defense and information solutions, will serve as CEO of the renamed and rebranded defense technology company.
An ITT spokesperson said the company is structuring the new businesses, including employment numbers and headquarters locations.
ITT in 2008 relocated its headquarters from West Red Oak Lane in Harrison to 1133 Westchester Ave. in White Plains, where it consolidated its metropolitan New York and New Jersey operations in approximately 100,000 square feet of office space.