United Technologies Corp. is studying the sale of a pump- and compressor-making division to raise cash for the planned purchase of aerospace supplier Goodrich Corp., people with knowledge of the matter say.
Goldman Sachs Group Inc. is advising on the potential divestiture of some or all of that business, which is part of the Hamilton Sundstrand unit, said the people, who spoke on condition of anonymity because the talks are private. The company may decide not to go ahead with a sale, which may value the unit at $2 billion or more, the people said.
The industrial products unit, which makes Milton Roy pumps and Sullair compressors, is among the few at United Technologies not focused on aviation or commercial buildings. Executives have been weighing asset sales to limit the amount of stock needed for the $16.5 billion cash purchase that will add Goodrich to the maker of Otis Elevators and Sikorsky helicopters.
“There’s absolutely no synergies I can really think of between one of those Sullair compressors on two wheels at a construction project and anything else they do,” says Brian Langenberg, an analyst at Langenberg & Co. in Chicago.
Potential buyers may include construction-equipment makers betting on a rebound in the non-residential market, Langenberg said yesterday in a telephone interview. Hartford, Connecticut- based United Technologies may be able to raise $1 billion more by selling assets in its fire and security unit, he adds.
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