Diversified business conglomerate United Technologies Corp. (UTX - Free Report) recently announced that it has sold the electric power systems business of the erstwhile Goodrich Corporation to Safran SA, a French aircraft & rocket engine manufacturer, for $400 million.
The asset sale is a part of the mandatory requirements set by the regulatory authorities related to the acquisition of Goodrich by United Technologies. Earlier in the month, the company also divested the pump and engine control systems business of Goodrich to Triumph Group, Inc. (TGI - Free Report) for an undisclosed amount.
The chain of events follows the acquisition of Goodrich on Jul 26, 2012, for $16.5 billion. Post-acquisition, United Technologies integrated it with the legacy Hamilton Sundstrand division to form a new operating segment named UTC Aerospace Systems. Hamilton Sundstrand is one of the world’s leading suppliers of technologically advanced aerospace and industrial products and aftermarket services for diversified industries worldwide. Its product portfolio includes power generation, management and distribution systems, flight systems, engine control systems, environmental control systems, fire protection and detection systems, auxiliary power units and propeller systems. Aftermarket services include spare parts, overhaul and repair, engineering and technical support and fleet maintenance programs.
The acquisition resulted in the merger of the two leading aircraft manufacturers in the industry to create a behemoth that produce aviation equipments for premier companies such as The Boeing Company (BA - Free Report) , Lockheed Martin Corporation (LMT - Free Report) , and Airbus. The merger also led to economies of scale, increased financial flexibility, and complementary products at an opportune time when the commercial aerospace industry is poised for growth.
Based in Hartford, Conn, United Technologies provides high-end technology products and services to the building systems and aerospace industries worldwide. The company serves various end markets such as aerospace, defense and commercial construction. The business diversification allows the company to remain profitable amid tough economic times.
The operations of United Technologies are primarily classified into two principal businesses: commercial and aerospace. Under its commercial business, the company has Otis and the UTC Climate, Controls & Security division, which combined the former Carrier and UTC Fire & Security divisions. The aerospace business of the company consists of Sikorsky aircraft and the UTC Propulsion & Aerospace Systems, which includes UTC Aerospace Systems and Pratt & Whitney divisions. Concurrently, United Technologies presently has five principal business segments: Otis; UTC Climate, Controls & Security; Pratt & Whitney; UTC Aerospace Systems; and Sikorsky.
United Technologies currently has a Zacks Rank #3 (Hold).