Tyco to split in three, again

SCHAFFHAUSEN, Switzerland—Tyco International plans to split into three independent, publicly traded companies, according to a plan unanimously approved by the board of directors and announced this morning at ASIS 2011.

The new companies will be: ADT North America Residential; Commercial Fire and Security; and Flow Control.

This is the continuation of a process the Tyco board and Ed Breen, its chairman and CEO, began in 2006, when the company divested its healthcare and electronics divisions.

"All three companies will have industry-leading positions in large and fragmented industries and enhanced capabilities to serve their distinct customers," Ed Breen, Tyco International's chairman and CEO, said in a prepared statement. "Importantly, the new standalone companies will have greater flexibility to pursue their own focused strategies for growth—both organic and through acquisitions—than they would under Tyco's current corporate structure. This will allow all three companies to create significant value for shareholders."

The company said it will “issue tax-free stock dividends of the ADT and flow control businesses to Tyco shareholders, after which Tyco shareholders will own 100 percent of the equity in each of the three publicly traded companies.”

The sale is expected to take one year to complete and needs shareholder approval.

The plan now is for Breen to “become non-executive chairman of the commercial fire and security company, a director of the flow control company, and a consultant to the ADT North America residential company. In addition, current Tyco directors are expected to serve on the boards of each of the three companies, including the roles of non-executive chairman of the flow control company and the ADT North America residential company.”