UTC starts integrating Goodrich into aerospace systems segment

Washington DC
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United Technologies will begin integrating Goodrich into its propulsion and aerosystems segment after receiving final regulatory approvals of the $18.4 billion acquisition.

The approvals by the US Department of Justice and the European commission were received early on 26 July, clearing the way for UTC to close the financial terms of the deal shortly afterward.

UTC announced the acquisition on 22 September, with the aim to combined Hamilton Sundstrand and Goodrich under the banner of the new UTC Aerospace Systems segment.

"I'm very pleased we will close such a large transaction in just 10 months with limited required divestitures," says Louis Chenevert, UTC's chief executive.

"Bringing these two companies together will significantly strengthen our position in the growing aerospace segment and will allow us to develop more integrated systems for our customers and win greater content on next-generation aircraft."

The acquisition combines some overlapping elements within the Goodrich and Hamilton Sundstrand portfolios, but UTC officials have also emphasised many complementary assets. For instance, Goodrich's aircraft breaking systems could be upgraded and tightly integrated with Hamilton Sundstrand's new generation of electronic braking controls.

UTC expects the acquisition to boost earnings per share in 2013 between 50 cents and 55 cents, but will provide a more detailed update in September. By then, the executives will have had two months to integrate Goodrich and better understand the possibilities.

"I don't think we've seen anything that would indicate that [the earnings per share guidance] is going to be off by any order of magnitude," says Greg Hayes, UTC's chief financial officer. "I think by the end of September we'll have our arms clearly around that."