United Tech Rejects Honeywell's $90.7 Billion Offer

• By Sydny Shepard
• Feb 29, 2016

United Technologies has rejected Honeywell Inc’s $90.7 billion offer saying that pursuing a merger would be “irresponsible” toward its shareholders.

In an unusual move, the two companies sparred publically about a deal that, if carried through, would create one of the largest U.S. companies with almost $100 billion in annual sales.

United Tech said the two companies had talked about possible combination for years, but said that the regulatory environment had changed and a merger would be far outweighed by regulatory delays, required divestitures and customer concerns and concessions.

United Tech’s rejection of the offer came only hours after Honeywell spelled out the details of the $90.7 billion deal to acquire United Tech. The offer included $42.63 billion in cash and 0.614 of its shares for each United Tech share. The proposal represents a 22 percent premium to United Tech’s closing price on Feb. 19, the last trading day before the talks were made public.

United Tech is the parent of Otis elevators, Carrier air conditioners and Pratt & Whitney jet engines, while Honeywell makes thermostats, auto turbochargers and airplane cockpit electronics. Areas of overlap between the companies include small aircraft engines, airplane power units and environmental systems as well as wheels and brakes.