UTC completes Rockwell Collins acquisition, plans 3-way split

Farmington, Connecticut-based United Technologies Corp. (UTC) has completed its acquisition of Rockwell Collins and intends to separate its other commercial businesses, Otis and Carrier (formerly Climate, Controls & Security (CCS), into three independent companies. 

UTC's acquisition of Rockwell Collins brings together Rockwell Collins and UTC Aerospace Systems to create Collins Aerospace Systems with a global presence of 70,000 employees in 300 sites and $23 billion in annual sales in 2017.

United Technologies, comprised of Collins Aerospace Systems and Pratt & Whitney, will continue as a systems supplier to the aerospace and defense industry.

Otis Elevator Co., a manufacturer of elevators, escalators, and moving walkways; and Carrier, a global provider of heating, ventilation, and air conditioning (HVAC), refrigeration, building automation, fire safety, and security products, will be spun off, pending approvals.

"Our decision to separate United Technologies is a pivotal moment in our history and will best position each independent company to drive sustained growth, lead its industry in innovation and customer focus, and maximize value creation," said United Technologies Chairman and CEO Gregory Hayes.

The combined sales of Collins and Pratt & Whitney totaled $39.0 billion in 2017. Collins Aerospace supplies electrical, mechanical and software solutions across all major segments of the aerospace industry and serves commercial and military customers. Pratt & Whitney is a global leader in aircraft propulsion with a growing number of engine programs including the Geared Turbofan commercial engine and the F135 military engine for the F-35 Joint Strike Fighter program.

Founded 165 years ago, Otis has more than two million elevators under maintenance, the largest aftermarket service portfolio of any elevator manufacturer, and $12.3 billion in 2017 sales. Recent investments include digitally-enabled field service capabilities. 

Carrier revives an iconic name, and along with its other brands – Kidde, Edwards, LenelS2, and Automated Logic – produced 2017 sales of $17.8 billion. The company has released more than 200 new products during the last two years.

Gregory Hayes will oversee the transition and will continue in his current role as UTC Chairman and CEO following the separation, expected to be completed in 2020, with separation activities occurring within the next 18 to 24 months.

"Collins Aerospace brings together two great companies with unmatched expertise in developing electrical, mechanical and software solutions," Hayes said.

Evercore and Goldman Sachs & Co. are acting as financial advisors, and Wachtell, Lipton, Rosen & Katz is serving as legal advisor to United Technologies.