Goodrich Agrees to be Acquired by United Technologies; Shares Soar (GR, UTX)

Goodrich Corporation (NYSE: GR) shares have risen sharply after the Charlotte, North Carolina-based company agreed to be acquired by United Technologies Corporation (NYSE: UTX) for $127.50 per share in cash, equating to a total enterprise value of $18.4 billion.

Goodrich shares reached a new 52-week high of $120.93 earlier in the day before retreating slightly. At last check, Goodrich shares were trading 10.14% higher at $120.59.

Goodrich, which supplies aerospace components, systems and services to the commercial and general aviation airplane markets, was rumored to be a possible takeover target for United Technologies. The speculation had risen after reports that United Technologies was seeking $20 billion in financing for a large acquisition. United is expected to finance the acquisition through a combination of debt and equity issuance, with the equity component to approximate 25% of the total.

On completion of the acquisition, United Technologies is expected to have global sales of around $66 billion. The acquisition will strengthen United Technologies’ position in the aerospace and defense industry.

Goodrich, which is estimated to have sales of $8 billion in 2011, is well positioned for growth in the future based on its rising content on leading new commercial and military aircraft. According to United Technologies Chairman and CEO, Louis Chenevert, Goodrich is a great business with a solid product portfolio and substantial aftermarket sales that complement United Technologies’ existing aerospace presence.

Goodrich CEO Marshall Larsen, meanwhile, said that the company is pleased to have an agreement with United Technologies that delivers immediate cash value to its shareholders at a premium that reflects the strength of its business. Larsen further said that the combination with United Technologies is a testament to the company’s employers and will allow it to shape the future of aerospace through continued innovation, increased global scale and the best talent in the industry.

On completion of the transaction, Larsen will become the Chairman and CEO of a combined United Technologies’ Aerospace Systems business unit.

Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.