Honeywell & Cambridge Quantum Joint Venture: A New Quantum Business

Honeywell and Cambridge Quantum Computing Announce Joint Venture

Honeywell, having recently entered the field of quantum computing, and Cambridge Quantum Computing (CQ), a firm specializing in quantum computer software development, have jointly declared the formation of a new venture. This will integrate Honeywell’s Quantum Solutions (HQS) business with Cambridge Quantum.

Existing Partnership and Investment

Honeywell and CQ have maintained a collaborative partnership for some time, with Honeywell having made a significant investment in the company during the previous year. The intention behind this move is to synergize Honeywell’s proficiency in hardware development with CQ’s software expertise.

Goals of the New Venture

The combined entity aims to create what both companies describe as “the world’s highest-performing quantum computer” alongside a comprehensive suite of quantum software. This includes the development of what they claim is the first and most advanced quantum operating system.

Timeline and Leadership

The completion of this merger, referred to as a “combination” in company statements, is anticipated during the third quarter of 2021. Darius Adamczyk, Chairman and CEO of Honeywell, will assume the chairmanship of the newly formed company.

Ilyas Khan, founder and CEO of CQ, will serve as the CEO of the new organization. Tony Uttley, currently President of Honeywell Quantum Solutions, will continue in a similar role within the combined company.

Honeywell’s Role and Investment

The strategy involves Honeywell spinning off HQS and merging it with CQC to establish a new company. Honeywell will retain a controlling stake and invest between $270 and $300 million.

A long-term agreement is also in place for Honeywell to continue manufacturing the ion traps that form the core of its quantum hardware. CQ’s shareholders will collectively hold 45% ownership in the new company.

Image Credits: Honeywell

Statements from Leadership

Adamczyk stated that the new company will possess leading talent, the highest-performing quantum computer, an advanced quantum operating system, and comprehensive software. This will drive the future of the quantum computing industry.

He further emphasized the company’s strong position to generate value by providing essential global infrastructure to support the rapid expansion of the quantum computing sector.

The Need for Integrated Solutions

The companies contend that a thriving quantum computing business requires substantial investment and a comprehensive, integrated approach offering both hardware and software solutions. Combining their strengths will allow them to build upon their respective leadership positions and accelerate research and development.

Access to Capital

Adamczyk explained that since the announcement of Honeywell’s quantum business in 2018, there has been significant investor interest. The new company will provide a suitable platform for attracting diverse sources of capital to fuel rapid growth.

Cambridge Quantum Computing Background

Founded in 2014, CQ currently employs approximately 150 individuals. The company has raised a total of $72.8 million in funding, including a $45 million round announced last December.

Investors in this last round included Honeywell, IBM Ventures, JSR Corporation, Serendipity Capital, Alvarium Investments, and Talipot Holdings. Notably, this means that IBM, a competitor in the quantum computing space, now holds a minority stake in the new venture.