8-KAcquisitions & DispositionsMaterial AgreementsFinancial Events+1

RTX Corp 8-K Report, Agreement Terminated (Jul 26, 2012)

Filed July 26, 2012For Securities:RTX

Summary

This Form 8-K filing by United Technologies Corporation (UTC) on July 26, 2012, primarily announces the successful completion of its acquisition of Goodrich Corporation. The merger, which saw Goodrich become a wholly-owned subsidiary of UTC, involved each Goodrich share being converted into $127.50 in cash. This significant transaction marks a major strategic move for UTC, integrating Goodrich's operations into its portfolio. In conjunction with the acquisition, UTC also terminated an unused Bridge Credit Agreement and simultaneously drew down $2.0 billion under a Term Loan Credit Agreement to partially finance the merger consideration. The Term Loan is set to mature by December 31, 2012, and carries interest rates based on either an adjusted base rate or LIBOR plus an applicable margin tied to UTC's credit ratings. Investors should note the cash component of the acquisition and the immediate use of debt financing to fund it.

Key Highlights

  • 1Completion of the acquisition of Goodrich Corporation for cash, with each share valued at $127.50.
  • 2Goodrich Corporation is now a wholly-owned subsidiary of United Technologies Corporation (UTC).
  • 3Termination of the previously established Bridge Credit Agreement, under which no borrowings were made.
  • 4UTC borrowed $2.0 billion under a Term Loan Credit Agreement to partially fund the acquisition.
  • 5The $2.0 billion Term Loan is short-term, with a maturity date of December 31, 2012.
  • 6Interest rates on the Term Loan are variable, based on an adjusted base rate or LIBOR plus an applicable margin linked to UTC's credit ratings.

Frequently Asked Questions

The primary purpose of this filing was to officially announce the completion of United Technologies Corporation's (UTC) acquisition of Goodrich Corporation and to report on the related financing activities.

The acquisition was financed through a combination of cash, with each Goodrich share receiving $127.50. UTC utilized a $2.0 billion draw from its Term Loan Credit Agreement to partially fund this cash consideration.

The $2.0 billion borrowed under the Term Loan Credit Agreement matures on December 31, 2012, unless repaid earlier by UTC or accelerated due to specific default events.

No, the Bridge Credit Agreement was terminated on the same day as the acquisition's completion, and no borrowings were ever made under it. The Term Loan Credit Agreement was used for the financing.