Courtesy of Benzinga.
Third Point sent a letter Friday to United Technologies Corporation (NYSE: UTX)’s board of directors laying out concerns over the company’s proposed merger with Raytheon Company (NYSE: RTN).
The activist investor is urging the board to re-evaluate the transaction. The merger has no compelling strategic or financial rationale and is unlikely to create sufficient value for shareholders, according to Third Point.
“The contemplated transaction instead complicates the narrative of a more focused aerospace company that was intended to emerge from UTC’s breakup. Third Point will not support the merger in its current form and plans to vote against it. We are confident many of our fellow shareholders feel the same way,” Third Point CEO Dan Loeb said in the letter.
A United Technologies spokeswoman said in a statement that the company does not agree with Third Point’s conclusions, and said other shareowners see the merger as desirable.
“The United Technologies Board of Directors unanimously approved the transaction following a careful and thorough review process and remains confident that the merger will create a premier systems provider with advanced technologies to address rapidly growing segments of aerospace and defense, and create significant long term value for both companies’ shareowners.”
United Technologies continues to expect the deal to close in the first half of 2020, the statement said.
United Technologies shares were trading slightly higher at $129.02 at the time of publication Friday, while Raytheon shares were down 0.52% at $177.15.
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Posted-In: M&A News Hedge Funds General Best of Benzinga
