Raytheon, UTC merger closer to final with spinoff of subsidiariesNews
March 13, 2020
FARMINGTON, Conn. The board of United Technologies Corp. (UTC) has approved the spinoff of the company’s Carrier heating and cooling and Otis elevator subsidiaries, keeping its planned merger with Raytheon on track.
The European Commission had expressed concern that a UTC/Raytheon merger would have reduced competition in the markets for military GPS receivers and airborne radios. To address these concerns, UTC and Raytheon offered to divest UTC’s entire military GPS receiver and antijamming business (located in Iowa) and Raytheon’s entire military airborne radios business (based in Indiana).
The Commission said that the remedies removed the entire horizontal overlap and that now the modified transaction would no longer raise competition concerns.
UTC agreed in June 2019 to combine its aerospace business with Raytheon and create a new company worth about $121 billion, in what is expected to be the sector’s biggest ever merger. Shareholders of UTC and Raytheon approved the merger in October 2019; the deal -- with the agreed-upon amendments -- is expected to be finalized during the second quarter of 2020, subject to final regulatory approvals.