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United Technologies announces intention to separate into three companies

CCS will be renamed Carrier, says company’s representative

| | Dec 11, 2018 | 5:48 pm
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Farmington, Connecticut, USA, 11 December 2018: United Technologies Corp. (UTC) today announced the completion of its acquisition of Rockwell Collins and the company’s intention to separate its commercial businesses, Otis and Carrier (formerly CCS), into independent entities, through a Press communiqué. The separation will result in three global companies, the communiqué said.

According to United Technologies, the three companies will be:

  • United Technologies, comprising Collins Aerospace Systems and Pratt & Whitney, will be the systems supplier to the aerospace and defence industry; Collins Aerospace was formed through the combination of UTC Aerospace Systems and Rockwell Collins;
  • Otis, the manufacturer of elevators, escalators and moving walkways;
  • Carrier, a global provider of HVAC, refrigeration, building automation, fire safety and security products.

Gregory Hayes, Chairman and Chief Executive Officer, United Technologies, said, “Our decision to separate United Technologies is a pivotal moment in our history and will best position each independent company to drive sustained growth, lead its industry in innovation and customer focus, and maximise value creation.”

The proposed separation is expected to be effected through spin-offs of Otis and Carrier that will be tax-free for UTC shareowners for U.S. federal income tax purposes, the communiqué said. Each spin-off is subject to the satisfaction of customary conditions, including final approval by UTC’s Board of Directors, receipt of a tax opinion from counsel, the filing and effectiveness of a Form 10 registration statement with the U.S. Securities and Exchange Commission and satisfactory completion of financing, the communiqué further said. Gregory Hayes will oversee the transition and will continue in his current role as Chairman and CEO, UTC, following the separation, the communiqué added.

According to UTC, one-time transaction costs are expected to include non-U.S. tax expense, debt financing, operational separation activities and other customary items. The communiqué said separation is expected to be completed in 2020, with separation activities occurring within the next 18-24 months. The communiqué further said there can be no assurances regarding the ultimate timing of the separation or that the separation will be completed.

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