Otis Elevator in Florence County to be spun off from United Technologies
NEW YORK — United Technologies is breaking itself into three independent companies now that it has sealed its $23 billion acquisition of aviation electronics maker Rockwell Collins.
As part of the divestiture, Otis Elevator will be spun off into a standalone company along with Carrier while United Technologies which will be composed of its aerospace and defense industry businesses.
Otis Elevator Company, one of Florence County’s 20 largest employers according to state officials, is the world’s leading manufacturer of people-moving products, including elevators, escalators and moving walkways, with significant recurring revenue from long-term maintenance contracts and $12.3 billion in 2017 sales.
“UTC has announced that it intends to separate into three independent companies, each focused on its particular industry: Otis, Carrier (formerly Climate, Controls & Security), and United Technologies – an aerospace company consisting of Pratt & Whitney and Collins Aerospace. Over the years, we have benefitted tremendously from our relationship with UTC and our sister companies – and UTC has benefitted with Otis as part of its portfolio. The timing is now right and Otis is expected to move forward as an independent company, and we’re excited about this news and our future. Planning will start immediately and implementation will take approximately 18-24 months,” Otis officials told the Morning News.
The company’s announcement Monday was the latest by a sprawling industrial conglomerate deciding it will be more efficient and focused as smaller, separate entities.
“Our decision to separate United Technologies is a pivotal moment in our history and will best position each independent company to drive sustained growth, lead its industry in innovation and customer focus, and maximize value creation,” said United Technologies CEO Gregory Hayes.
The separation is expected to be completed in 2020, United Technologies said.
On Friday, United Technologies said it received final regulatory approval for its deal for Rockwell Collins, a Cedar Rapids, Iowa-based maker of flight deck avionics, cabin electronics and cabin interiors. The newly minted combined aerospace business would have had sales of about $39 billion last year, United Technologies said.
Hayes will stay on as CEO of the aerospace business. The company did not name leaders for the separated Otis and Carrier businesses.
Founded in 1934, United Technologies is based in Farmington, Connecticut, and currently employs about 205,000 people. It did not say if any jobs would be lost in the breakup.
The company got embroiled in politics in 2016 when then-presidential candidate Donald Trump criticized plans to close a Carrier plant in Indianapolis and shift production to Mexico. Weeks after Trump won the election, Carrier announced an agreement brokered by the president-elect to spare about 800 jobs in Indianapolis, where the company has pledged to keep nearly 1,100 jobs. That’s down from the approximately 1,600 factory, office and engineering jobs at the facility.