WHITE PLAINS, New York (AP) — Defense contractor ITT Corp. said Wednesday it will split itself into three publicly traded companies, separating its defense and information business, its water technology unit and its industrial products business.
ITT said its board of directors has approved the plan. The separations will be tax free spinoffs. ITT said the split should be complete by the end of the year, and its shareholders will own stock in all three companies once the plan is complete.
ITT shares jumped in pre-market trading, approaching their highest price in more than two years.
The company said its engineered industrial products division will keep the ITT Corp. name. That company will include businesses that make advanced industrial pumps, valves, and systems used in the oil and gas, mining, chemical power, and pulp and paper industries. It will also make products like shock absorbers, brake pads, aerospace valves, and other items.
ITT 's Chief Financial Officer Denise Ramos will be CEO of that company, and its chairman will be Frank MacInnis, an ITT director and former chairman and CEO of industrial construction company EMCOR Group.
ITT expects that business to have about $2.1 billion in revenue this year.
The water technology business will include ITT's residential and commercial water, flow control, and water and wastewater businesses, which makes products used in water transport, testing, and treatment. Gretchen McClain, the president of ITT's fluid and motion control business, will be the CEO of the new company. ITT Chairman, President and CEO Steve Loranger will be the company's chairman.
The business is expected to report $3.6 billion in revenue in 2011.
The third company will include ITT's defense and information solutions business. Products and services from that business include night vision technology, electronic warfare technology, communications, radar, intelligence, surveillance, and satellite imaging, the company said. David Melcher, the president of the business, will become the company's CEO, and ITT director Ralph Hake will become chairman of the board.
ITT said the defense business will have about $5.8 billion in revenue for the year.
Shares of ITT jumped $7.07, or 13.4 percent, to $59.85 in pre-market trading. The stock closed at $52.78 Tuesday and last traded above $59 in September 2008.