NEW YORK (The Deal) -- United Technologiesundefined said late Wednesday it was exploring options for its Sikorsky Aircraft unit, as the sprawling conglomerate looks to refocus its businesses and spark its lagging stock price.

Hartford, Conn.-based UTC said it retained JPMorgan Chase (JPM) - Get Report to consider options including a sale or a spinoff of Sikorsky into an independent, publicly-traded entity. The unit manufactures helicopters and other fixed-wing aircraft, generating about two-thirds of its $7.5 billion in annual sales from defense.

The announcement comes just months after the UTC board's November decision to push CEO Louis Chenevert into retirement, replacing him with chief financial officer Greg Hayes. Hayes, as part of the transition, initiated a review that concluded Sikorsky was no longer a good fit with the company's aerospace component and building systems portfolio.

"Looking to the future, we are evaluating whether Sikorsky's unique business as a rotorcraft [original equipment manufacturer] with a predominately military customer base is best positioned as a stand-alone company, and whether a separation would allow United Technologies to better focus on providing high-technology systems and services to the aerospace and building industries," Hayes said.

The move could also at least temporarily placate what had been seen as a restless shareholder base. Sterne Agee analyst Peter Arment last month said his sum-of-the-parts valuation of the company comes in at $161 per share before debt, 35% above the company's Wednesday close, concluding that the current value "leaves the door open for activism."

But it is not clear that Sikorsky will be an easy sell. It is uncertain that competitors including Boeing (BA) - Get Report and Bell Helicopter, which is owned by Textron (TXT) - Get Report, are interested in committing billions of dollars to grow their helicopter operations. Other large helicopter makers like Airbus Helicopters and Agustawestland Holdings are tied to European parents hampered by a weak Euro.

Sikorsky also has been part of the UTC portfolio since the 1920s, meaning it has a low cost basis and would generate a substantial tax bill in a sale. A defense source reached Thursday suggested that private equity could be interested in the helicopter company, but said a spinoff would be the most likely outcome.

UTC has spoken with government officials to reassure them that an independent Sikorsky would remain a viable military supplier.

The executive said no other UTC assets are currently under review, dousing speculation that UTC could consider a larger split.

Some have suggested the company should separate its aerospace business from its building controls, a grouping that includes Carrier HVAC, Chubb security, Kidde safety products and Otis elevators, to shed its perceived conglomerate discount.

Hayes has made it clear he would like to add to the portfolio as well, and has suggested the weak euro could create opportunities.

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