United Technologies Corporation closed its $18.4 billion acquisition of Charlotte-based Goodrich Corp. Thursday, after regulators required the company to sell some of Goodrich’s assets to satisfy antitrust concerns.
United Technologies is planning to create a new headquarters in Charlotte for its aerospace business, with 325 jobs paying an average of $200,000. Goodrich currently employs about 200 people in Charlotte, and the city has said it expects about 100 Charlotte-based employees to remain in the new division headquarters.
The companies first announced their plan to combine in September. And while the deal will bring a new aerospace unit headquarters in Charlotte, it also represents the loss of one of the Charlotte region’s nine Fortune 500 headquarters.
The deal is one of United Technologies’ largest. “Throughout the history of our company, we have made many acquisitions, but Goodrich is among the few that stand out as truly transformational,” said United Technologies chief executive Louis Chênevert, in a statement after the deal officially closed. The Hartford, Conn.-based company had revenues of more than $58 billion last year, while Goodrich made more than $8 billion.
Goodrich CEO Marshall Larsen will join the new company’s board of directors in September, at UTC’s annual meeting, the company said.
The city of Charlotte is giving United Technologies $2.5 million worth of incentives for the headquarters, much of it upfront to help defray moving expenses. The state is also giving United Technologies $2.5 million worth of incentives.
The U.S. Department of Justice filed both an antitrust lawsuit and a proposed settlement Thursday, issuing conditional approval of the acquisition. European and Canadian regulators also worked with the DOJ, and also signed off on the deal.
United Technologies must sell several units, including Goodrich’s engine control systems unit, and Goodrich’s shares of Aero Engine Controls, an aircraft turbine manufacturing joint venture with Rolls-Royce.
“The acquisition, as originally proposed, likely would have resulted in higher prices, less favorable contractual terms and less innovation for several critical aircraft components, including generators, engines and engine control systems,” DOJ officials said in a statement.
Those units United Technologies is required to divest generate a combined $250 million in sales, Chênevert told analysts during a conference call. He said he was pleased with the limited nature of the required sales.
“These are attractive businesses with great employees, so we expect a robust auction,” Chênevert said