Directors of Ingersoll-Rand plc unanimously approved a plan to spin off the conglomerate’s commercial and residential security businesses, creating two standalone companies held by current shareholders. The first company, continuing as Ingersoll Rand, will include the current group’s industrial, transport refrigeration, and heating, ventilation and air conditioning (HVAC) businesses.

Ingersoll Rand presently consists of multiple industrial and consumer brands, and manufactures and extensive series of air compressors and related equipment, as well as multiple product lines with a consumer focus. The new company being established is being defined as a “global provider of electronic and mechanical security products and services” for commercial and residential customers.

The spin-off is intended to be tax-free to shareholders, Ingersoll-Rand stated, and it predicted it would be completed in approximately 12 months.

“Given the distinct strengths and strategies of the two proposed companies, the board believes that this structure will enable investors to value our different businesses separately, creating value for both companies and their shareholders,” stated Ingersoll Rand chairman/CEO Michael W. Lamach.

Following the spin-off, Lamach will continue as Ingersoll Rand’s chairman and chief executive officer.

The future Ingersoll Rand will include the group’s industrial, transport refrigeration, and HVAC businesses, which will include the Ingersoll Rand, Trane, American Standard, Ameristar, Thermo King, Aro, and Club Car brands.

Based on 2011 revenues, this new company will have annualized revenues of approximately $12 billion,

The new company — still to be named — will consist of Ingersoll Rand’s commercial security business (called Security Technologies) combined with its residential security business (presently part of its Residential Solutions unit.) Its product lines will include the Schlage, LCN, Von Duprin, Interflex, CISA, Briton, Bricard, BOCOM Systems, Dexter, Kryptonite, Falcon, and Fusion Hardware Group brands.

The forecast for the new company, also based on 2011 revenues, is for annualized revenue of approximately $2 billion.

“We believe the spin-off, which is the result of an in-depth review of strategic alternatives by our board and management, will allow both companies to enhance value by allocating capital and deploying resources in a more focused way, while preserving and increasing synergies within their businesses,” Lamach stated. “At the same time, it will position the new security company to build scale and make the necessary investments for the future.”

He concluded by observing that the proposed standalone companies will have the advantages of leading market positions, well-known brands, and experienced people. And, he said both companies would be in able to execute strategic plans, serve customers, and to grow better under the new organization.