Moody's affirms United Technologies, may up Goodrich

Moody's Investors Service said it affirmed United Technologies Corp.'s A2 senior unsecured and prime-1 short-term ratings following news it reached an agreement to acquire Goodrich Corp. for $18.4 billion, including assumed Goodrich debt.

Moody's also said it placed Goodrich's Baa2 senior unsecured ratings under review for possible upgrade.

The ratings reflect a view that Goodrich's aerospace businesses represent good strategic additions to the company's existing portfolio, the agency said.

Despite about a $12 billion increase in debt to fund the transaction, the strong earnings and cash flow profile of the combined businesses, coupled with historically demonstrated and committed fiscal conservatism should result in fairly quick restoration of financial metrics to levels supportive of the A2 rating, Moody's said.

With forecasted 2011 revenues of about $8 billion, Goodrich brings strong competitive positions in its three business segments, which are complementary to United Technology's businesses, the agency added.

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