Sikorsky spinoff?
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Sikorsky spinoff?
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United Technologies to explore strategic alternatives for its Sikorsky Aircraft business
I/C
United Technologies Corp. has authorized a review of strategic alternatives for Sikorsky, including a potential tax-free spinoff.
"As part of the portfolio review announced last December, we are exploring strategic options for Sikorsky to determine the best way to enhance its long-term success and create improved long-term value for UTC's customers and shareholders," said UTC President & CEO Gregory Hayes.
"We are evaluating whether Sikorsky's unique business as a rotorcraft OEM 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."
UTC expects to conclude its strategic review before the end of the year. However, no specific timetable has been set, and there can be no assurance that a spinoff or any other transaction will take place.
"As part of the portfolio review announced last December, we are exploring strategic options for Sikorsky to determine the best way to enhance its long-term success and create improved long-term value for UTC's customers and shareholders," said UTC President & CEO Gregory Hayes.
"We are evaluating whether Sikorsky's unique business as a rotorcraft OEM 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."
UTC expects to conclude its strategic review before the end of the year. However, no specific timetable has been set, and there can be no assurance that a spinoff or any other transaction will take place.
The long rumored "consolidation of the rotary wing industry" seems to have grown fresh legs.
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That probably hurt, but a precedent was a series of presidents that came from other companies. Something changed!
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Sikorsky is currently profitable with EBITDA margins around 6%, but this is well below other divisions of UTC. Approximately 72% of Sikorsky's current revenues come from defense/government sales. Defense spending will likely continue its downward trend for the foreseeable future, which will make it hard for Sikorsky to remain profitable.
It appears UTC management sees this situation the same way. So UTC is looking to "spin off" (ie. dump) Sikorsky while they can get max value from it. I suspect UTC will probably saddle Sikorsky with some new debt before the "spin off" so they can pull cash out of the company.
It appears UTC management sees this situation the same way. So UTC is looking to "spin off" (ie. dump) Sikorsky while they can get max value from it. I suspect UTC will probably saddle Sikorsky with some new debt before the "spin off" so they can pull cash out of the company.
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UTC's Sikorsky Spinoff: Good For UTC, Good For Sikorsky...Two Out Of Three Ain't Bad - Forbes
A very informative article. No cross Atlantic mergers and the only 'natural' merger in the States (Boeing & Sikorsky) would be blocked, most probably by Governments on both sides of the Atlantic.
A very informative article. No cross Atlantic mergers and the only 'natural' merger in the States (Boeing & Sikorsky) would be blocked, most probably by Governments on both sides of the Atlantic.
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Sikorsky Future
News today that Sikorsky will be sold or spun off from United Technologies in the near future.
United Technologies to separate Sikorsky via sale or spinoff - MarketWatch
United Technologies to separate Sikorsky via sale or spinoff - MarketWatch
Not the article in question:
News today that Sikorsky will be sold or spun off from United Technologies in the near future.
United Technologies to separate Sikorsky via sale or spinoff - MarketWatch
United Technologies to separate Sikorsky via sale or spinoff - MarketWatch
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Will be interesting to see if Textron is the buyer- do Bell and Sikorsky stay separate, does Bell take over Sikorsky, or Sikorsky take over Bell?
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Sikorsky seems to be in good shape financially for the near future, so they should do nicely on their own. But since much of their revenues are from military sales, they would also make a nice acquisition for a large defense business. Of the US companies mentioned LM might be a possibility. I doubt Textron(Bell) or Boeing would work out, primarily because the US DoD has been making a big push to expand the domestic rotorcraft industrial base, and not consolidate it. Maybe L-3 or Raytheon might have an interest.
I still don't accept UTC's (claimed) reason for selling off a fairly profitable division like Sikorsky. Less than a decade ago their Pratt & Whitney division was in far worse shape. P&W had few new orders for commercial engines and much of their revenues came from selling replacement parts. Then P&W decided to take a bold leap and bring their geared turbofan engine to market. Now P&W has orders for over 6,000 GTF engines. Sikorsky appeared to be doing the same thing with their internally funded X2 & S-97 programs. And if the Army continues with FVL, I think Sikorsky/LM have the best odds of winning the first contract.
I still don't accept UTC's (claimed) reason for selling off a fairly profitable division like Sikorsky. Less than a decade ago their Pratt & Whitney division was in far worse shape. P&W had few new orders for commercial engines and much of their revenues came from selling replacement parts. Then P&W decided to take a bold leap and bring their geared turbofan engine to market. Now P&W has orders for over 6,000 GTF engines. Sikorsky appeared to be doing the same thing with their internally funded X2 & S-97 programs. And if the Army continues with FVL, I think Sikorsky/LM have the best odds of winning the first contract.
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I still don't accept UTC's (claimed) reason for selling off a fairly profitable division like Sikorsky.
UT was the Sum of it's Brands
It wasn't that many years ago that few new who or what United Technologies was but they did know who Hamilton Standard, Pratt and Whitney, Otis, Carrier and Sikorsky were.
Lockheed to Buy Sikorsky
Looks like a done deal:
Exclusive: Lockheed to buy United Tech's Sikorsky for over $8 billion | Reuters
At $8B plus it is does not look like a good deal (UTC surprised anyone would offer that as they wanted to get rid of it at any cost). As Lockheed aviation is exclusively military this does not bode well for Sikorsky's commercial customers. Maybe Tilton will accept them and lead to the shining experience the MD homeys enjoy.
The Sultan
Exclusive: Lockheed to buy United Tech's Sikorsky for over $8 billion | Reuters
At $8B plus it is does not look like a good deal (UTC surprised anyone would offer that as they wanted to get rid of it at any cost). As Lockheed aviation is exclusively military this does not bode well for Sikorsky's commercial customers. Maybe Tilton will accept them and lead to the shining experience the MD homeys enjoy.
The Sultan