Uncertain future for Sikorsky no surprise to Connecticut

HARTFORD, Conn. (AP) — An uncertain future for Sikorsky Aircraft is nothing new to Connecticut officials.

The announcement Wednesday that aerospace and building systems giant United Technologies Corp. is considering options for the helicopter manufacturer, including a possible spinoff, did not surprise state economic development director Catherine Smith.

United Technologies CEO Greg Hayes, who took the top job in November, is looking at all of United Technologies’ holdings, Smith said Thursday. Subsidiaries include manufacturers of jet engines and aerospace components, elevators and heating and cooling systems.

“It’s no surprise. As CEO, he’s looking at every asset in the portfolio,” Smith said.

State officials included Sikorsky in a $500 million deal last year exchanging state aid for expansion because of talk that United Technologies might spin off or sell the manufacturer of the Black Hawk helicopter, Smith said. “We wanted them in the transaction because we heard there were alternatives,” she said.

Hayes was asked at an investor analyst meeting in February 2014 if the Stratford-based company would be ditched. He would not directly answer the question, saying it has a “very bright future, but a tough couple of years.”

Sikorsky has a sizable stake in military sales with its workhorse Black Hawk, but the U.S. drawdowns in Afghanistan and Iraq have had a financial impact. Revenue of $7.45 billion last year was up 19 percent from 2013, but operating profit fell and Sikorsky’s profit margin was the smallest of United Technologies’ segments.

The state deal, which includes jet engine manufacturer Pratt & Whitney and United Technologies’ research center, requires United Technologies to return benefits if Sikorsky or any other business segment leaves Connecticut or seeks to quit the deal.

Talk of a change of ownership or location of Sikorsky worries state officials who are sensitive to potential damage to Connecticut’s high-value manufacturing industry and its skilled, high-wage jobs.

Democratic U.S. Sens. Richard Blumenthal and Chris Murphy said they will remain in “close contact” with Sikorsky and United Technologies to ensure that any change “preserves the vital defense industrial base” in Connecticut.

Blumenthal said his office has been in touch with the company and the workers, and he expects there will not be any job reductions at Sikorsky.

A spokesman for Gov. Dannel P. Malloy said the governor has been in communication with United Technologies executives and “has conveyed that as they are considering their options that it is in their best interest to keep Sikorsky located in Connecticut.”

The manufacturer dates its Connecticut home to 1929 when founder Igor Sikorsky purchased land in Stratford. The company became a subsidiary and later a division of United Aircraft Corp., which eventually became United Technologies.

A United Technologies spokesman did not immediately respond to a request for comment.

Source Article from http://finance.yahoo.com/news/uncertain-future-sikorsky-no-surprise-210743790.html

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