U.T. Close To Buying Goodrich For $15B

Negotiations between the two companies are continuing to settle a dispute over price, and a deal is expected to be reached as early as this weekend.

Charlotte, North Carolina-based Goodrich, a Fortune 500 company, is a leading global supplier of systems and services to the Aerospace and Defense industry. It supplies products from aerostructures, actuation and landing gear systems to engine controls, sensors and ISR systems for the aircraft industry.

The reported acquisition will see United Technologies add products for the commercial aircraft industry apart from its military aircraft focus. Goodrich is a supplier of products and equipments to Boeing Co. and Airbus for most of its commercial airplanes.

The deal between United Technologies and Goodrich could be struck between $115 and $125 per share, valuing Goodrich at about $15 billion. Goodrich has a current market capitalization of about $14 billion, and closed at $111.82 on Tuesday after hitting a 30-year high of 114.50.

United Technologies is said to have sounded out its bankers about raising as much as $15 billion in debt to finance for the deal, though it could also launch a small equity raising.

Reports earlier revealed that United Technologies' other acquisition targets included Textron and Rockwell Collins, though the priority was for Goodrich. Honeywell International Ltd. is the current leader in aerospace-systems business, as measured by revenue., with Goodrich at second place, United Technologies' Hamilton Sundstrand unit ranking third, and Rockwell Collins at the fourth position.

Hartford, Connecticut-based United Technologies, the parent company of jet engine manufacturer Pratt & Whitney, Otis elevator, and Sikorsky aircraft, appointed in late March William Brown as senior vice president of corporate strategy & development. Brown will be responsible in providing a comprehensive and fully integrated approach to acquisitions and other growth initiatives.

Brown was most recently the president of he company's UTC Fire & Security, where he was instrumental in completing over 40 acquisitions to improve product offerings and expand the company's geographic reach, culminating in the 2010 acquisition of GE Security for about $1.8 billion. The company is now looking forward to Brown for his leadership on the company's acquisition and organic growth initiatives.