UTX makes a good case against squashing the deal Go to the UTX web site and there are two documents that UTX released on the potential merger - a letter and a slide show, Cote has his work cut out for him in convincing them and institutions to go with his plan. Seems to be more about regulatory approval/process than immediate value to UTX shareholders.
Wow - 3.4% fund. At Honeywell's Voya 401K there is no fund that will provide a steady interest rate like what you have. The Fixed Income Fund fluctuates with money markets and can go negative! Do you get any company matching at UTX?
You would get a double whammy on the deal. First a 22% bump in stock value and then, being a holder in the combined company with some cash in hand, the potential of another 25% in stock appreciation over 12 to 24 months as the combined company realizes cost savings from synergies and management/employee reductions.
We need a "Trump" deal. Cote in charge for two years then retires and hands off to Hayes. Cote close to retirement anyway.
Agree that UTX is worth more in two years, but so is Honeywell. That's why a merger of equals males sense. Otherwise, neither side can afford it. The pieces would be worth more that the whole and they could repackage units for sale or spin-off.
Sounds like the news today was that they pursued a deal and it was turned down on basis of UTX believing that it would face too much scrutiny and not be approved. This could be the end of it or the beginning of round two. I was thinking more along the lines of a holding company formation. Combine operations wherever you can while thinking about eventual separation. The separation part would amount to eventual spin-off of combined groups. Like Engines, Avionics, Building Controls, Fire, Safety & Security, Process Controls, Transportation etc. The initial sale of overlapping products/services would help raise the cash-flow to cover the special charges necessary for re-packaging into salable or spin-off groups. Crazy? - yes a little
With the almost equal size of these two companies, this would most likely be a merger of equals. There would be divestitures on common stuff on both sides. The benefit would come with management reductions, factory combining/closings, combined engineering, sales, finance, corporate office etc. The benefit would take time to be realized.
Like last go around, the first shoe may be getting ready to drop and GE will be lurking in the shadows!