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UPDATE 1-Honeywell does not see regulatory hurdles for United Tech deal

Published 2016-02-23, 04:46 p/m
© Reuters. UPDATE 1-Honeywell does not see regulatory hurdles for United Tech deal
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Feb 23 (Reuters) - Aerospace component supplier Honeywell
International Inc HON.N confirmed on Tuesday that it had
engaged in deal talks with United Technologies Corp (N:UTX) UTX.N over
the past year, and said it did not see regulatory process as a
"material obstacle" to the deal.
The announcement comes a day after United Tech disclosed
merger talks with Honeywell and said a deal would "face
insurmountable regulatory obstacles".
United Tech, which makes Pratt & Whitney jet engines and
Otis elevators, said on Monday that a merger could either be
blocked outright or conditioned on significant divestitures
after a lengthy and disruptive review period that would destroy
shareholder value.
"A combined Honeywell and United Technologies would maintain
a strong investment grade rating, and have higher free cash
flow," Honeywell said.
A merger of the two firms would create a behemoth with
combined sales of more than $90 billion, a company responsible
for a huge amount of equipment on commercial airliners, ranging
from jet engines to airplane cockpits and landing gear.
United Tech and Honeywell first began exploring a merger as
early as 1993, but the talks were revived after a broad
strategic review initiated by United Tech Chief Executive Greg
Hayes when he took over last year, Reuters reported on Monday,
citing sources. That review also resulted in United Technologies
selling Sikorsky Aircraft to Lockheed Martin Corp (N:LMT) LMT.N .

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