United Technologies Corp. says it will buy Rockwell Collins Inc. for $140 a share in cash and UTC stock. The deal is worth a total of around $30 billion, according to a statement.
Rockwell Collins, based in Cedar Rapids, Iowa, is a leader in avionics, flight controls, aircraft interior and data connectivity equipment. Its estimated sales exceed $8 billion.
United Technologies Corp., based in Farmington, Conn., provides high technology products and services to the building and aerospace industries.
Under terms of the agreement, each Rockwell Collins shareowner will receive $93.33 per share in cash and $46.67 in shares of UTC common stock, subject to a 7.5 percent collar centered on UTC's Aug. 22, 2017, closing share price of $115.69.
UTC expects to fund the cash portion of the transaction consideration through debt and cash on hand. The transaction is expected to close by the third quarter of 2018, subject to approval by Rockwell Collins' shareowners, as well as other closing conditions, including regulatory approvals.
The purchase price implies a total equity value of $23 billion and a total transaction value of $30 billion, including Rockwell Collins' net debt.
On a pro-forma 2017 basis, UTC is expected to have global sales of approximately $67 billion to $68 billion following the transaction, based on estimated results.