It argues that separating Honeywell would lead to simplified strategies, focused management, enhanced capital allocation and better operational performance.

In early trading, the industrial conglomerate’s stock hit $242.77, for a gain of almost 8%, after activist investor Elliott Investment Management disclosed a $5 billion stake in the company. Shares closed up 3.

Activist investor Elliott Investment Management has taken a more than $5 billion stake in Honeywell International and is calling for the conglomerate to split into two separate companies.

Elliott Management is pushing for Honeywell International to split up its business after the activist investment fund built an over-$5 billion stake in the industrial conglomerate.

The push comes as new Honeywell CEO Vimal Kapur has led an aggressive repositioning with mergers, acquisitions and spinoffs.

As Honeywell’s largest active investor, Elliott Investment Management’s letter to Honeywell International argued that Honeywell should split into two entities—Honeywell Aerospace and Honeywell Automation.

Shares of Honeywell International Inc. rallied into record territory Tuesday after activist investor Elliott Investment Management L.P. disclosed a large stake and said it was pushing for a breakup of the company.

Activist investor Elliott Investment Management said Honeywell should split into two separate businesses on Tuesday, following in the footsteps of other industrial conglomerates that have broken up in recent years.

Honeywell International shares jumped Tuesday to an all-time high, after Elliott Investment Management said it has built a $5 billion-plus position in the industrials conglomerate and is seeking a breakup of the company.

Elliott said in a letter that it had built a stake worth more than $5 billion in Honeywell, one of its largest ever, and that management should split the company into two standalone businesses focused on aerospace and automation. Shares were up 3% on Tuesday, shedding some earlier gains.