It's the biggest deal in the history of aerospace.
United Technologies will buy airplane parts maker Rockwell Collins (COL) for $23 billion, or $140 a share, the companies announced on Monday. The deal is expected to close in the third quarter of 2018.
"This acquisition adds tremendous capabilities to our aerospace businesses and strengthens our complementary offerings of technologically advanced aerospace systems," said United Technologies chairman and CEO Greg Hayes.
The deal comes after a report recently suggested that a large activist hedge fund manager, possibly Third Point LLC's Dan Loeb, has been accumulating a big United Technologies stake and has put the avionics and industrial company on the defensive in an effort to have it spin off non-core businesses.
Larger companies targeted by activists often seek to make big transformative acquisitions as a poison pill on the insurgent fund's M&A efforts. It is very possible that the private activist agitations may have pushed United Technologies CEO Gregory Hayes to try to buy the cockpit gearmaker, in part, because he doesn't want to bow to pressure from an activist seeking to push the company into spin offs.
United Technologies stock traded down 5% to $112.02 on Tuesday afternoon. Rockwell shares traded up 0.5% to $131.20.
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