UTC Explores Sale of Chubb Fire and Security

October 31, 2018

FILE PHOTO – United Technologies Chairman and CEO Greg Hayes gives an interview to CNBC on the floor of the New York Stock Exchange (NYSE) in New York, U.S., September 5, 2017. REUTERS/Brendan McDermid

9/24/18

By Harry Brumpton, Arno Schuetze
Reuters

United Technologies Corp is exploring a sale of its Chubb Fire & Security division for more than $3 billion, people familiar with the matter said.

On Sept. 14, United Technologies CEO Greg Hayes said the company will announce a decision within 60 days about whether to break up. The company’s main business lines are comprised of aerospace engines, elevators and building equipment such as air conditioners.

Chubb was acquired by United Technologies for about $1 billion in 2003, and is now part of the company’s climate, controls and security division. It has been playing catch-up for market share with rivals Securitas AB and Tyco International Ltd. Tyco was acquired by Johnson Controls International Plc two years ago for $16.5 billion.

United Technologies, based in Farmington, Connecticut, has hired Bank of America Corp (BAC.N) to run an auction for Chubb, the sources said, asking not to be identified because the matter is confidential and cautioning that no deal is certain.

United Technologies did not respond to a request for comment, while Bank of America declined to comment.

United Technologies, maker of Pratt & Whitney engines, Carrier air conditioners and Otis elevators, has a market capitalization of approximately $113 billion. Chubb, headquartered in Britain, provides fire safety and security solutions for businesses and organizations around the world, although its business is predominantly in Europe.

Hayes said at an investor conference this month that United Technologies planned to close its pending $23 billion acquisition of aerospace parts maker Rockwell Collins (COL.N) by the end of this month. That deal has been held up by China delaying regulatory approval, amid an escalating trade row with the United States.

Investors have increasingly shunned sprawling industrial conglomerates, forcing peers such as General Electric Co (GE.N) and Honeywell International Inc (HON.N) to also announce the sale or spinout of major divisions.

Activist investor Bill Ackman’s hedge fund Pershing Square Capital Management LP and Daniel Loeb’s hedge fund Third Point LLC have been putting pressure on United Technologies to break up into three focused, standalone businesses.

Original story can be found here.

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Summit Purchases Multiple Fire Protection Companies in Michigan

October 15, 2018

10/12/18

Summit Companies

Company Purchases Businesses in Western, Eastern and Southeastern Michigan

SAINT PAUL, MINNESOTA — Summit Companies, a premier fire and life safety company, announced it has completed the purchase of Clark Fire & Safety, Inc. (“Clark Fire”) in Owosso, MI, Mid-Michigan Fire & Safety Supply, Inc. (“Mid-Michigan Fire”) in Greenville, MI, and Providence Fire Protection, Inc. d/b/a VanEx Fire Systems (“VanEx Fire Systems”) in Luna Pier, MI. These acquisitions are a strategic geographic expansion of Summit’s existing fire protection, life safety and consulting business in the state of Michigan. Summit Companies currently has branch offices in the states of Arizona, Iowa, Michigan, Minnesota, Nebraska, Nevada, North Dakota, and Wisconsin and performs work across the United States.

Clark Fire was founded in 1989 by Edward Clark and focused on portable extinguisher sales and service. Edward’s son David became the second generation owner of the business in 2006 and expanded Clark Fire’s offering to include industrial and kitchen suppression systems and fire sprinklers.

Gary Templar established Mid-Michigan Fire in 1997 and focused on fire extinguisher and kitchen suppression system sales and service to commercial and institutional customers in western Michigan. Mid-Michigan will be integrated into Summit’s Mount Pleasant, MI branch office.

Established by John Van Develde in 1977, VanEx Fire Systems initially provided fire extinguisher sales and service. Matt Miklovic purchased the business in 1997 and quickly expanded the product offering by adding carbon dioxide and clean agent systems, detection & control hardware, special hazard suppression and fire alarm systems to more broadly serve its commercial, industrial and institutional customers.

Summit Companies will retain the staff and technicians of Clark Fire, Mid-Michigan Fire and VanEx Fire Systems. The current offices of Clark Fire in Owosso, MI and VanEx Fire Systems in Luna Pier, MI will become new branch offices for Summit Companies.

“The addition of Clark Fire, Mid-Michigan Fire and VanEx Fire Systems creates the opportunity to offer those organizations’ customers an expanded, full range of fire life safety products and services,” said Jeff Evrard, CEO of Summit Companies. “The expansion of Summit Companies’ footprint in Michigan is in direct alignment with the company’s growth strategy to expand coverage within the state. Additionally, the office in Luna Pier will service the company’s expanding customer base in the state of Ohio.”


Multidistrict Legislation Requested for Foam Lawsuits by Tyco and 3M

October 8, 2018

Photo: Shutterstock

10/2/18

By Amanda Bronstad
The National Law Journal

The lawsuits come on the heels of a $670.7 million settlement with DuPont and Chemours Co. last year involving an MDL over a related chemical that has been linked to cancer and hypertension in pregnant women and other illnesses.

Manufacturers of foams used to fight fuel fires have asked to coordinate about 85 lawsuits that allege toxic chemicals in their products have leaked into drinking water, putting residents at risk of getting cancer and other illnesses.

In a motion filed last week, Tyco Fire Products LP and Chemguard Inc. asked the U.S. Judicial Panel on Multidistrict Litigation to send 75 cases to Massachusetts, where a federal judge is overseeing four actions “well into the litigation process.” The cases span seven states: Colorado, Delaware, Florida, Massachusetts, New York, Pennsylvania and Washington. 3M Co. filed a motion two days later to add nine more lawsuits from Alabama, Michigan, Minnesota and upstate New York.

The motions come after a federal judge in Colorado issued a Sept. 25 order in a class action brought on behalf of 64,000 residents of communities near Colorado Springs. They claim chemicals from the foam—referred to in court papers as aqueous film-forming foams—at the Peterson Air Force Base and the Colorado Springs Municipal Airport have leaked into their drinking water, causing pregnancy problems and kidney and thyroid diseases. They are seeking a medical monitoring fund and compensation for lost property values.

Plaintiffs in that case have filed a class certification motion, which the manufacturers have opposed. The motion goes before U.S. District Judge R. Brooke Jackson of the District of Colorado on Nov. 30—one day after the MDL panel’s next hearing in New York.

“This is a case we’ve been aggressively litigating for two years now,” said Hunter Shkolnik, whose New York firm, Napoli Shkolnik, is involved in a large share of the foam cases, including the Colorado class action. “And, on the eve of a class certification in Colorado, the defendants are doing everything in their power to remove the case from Judge Jackson. And it’s nothing more than forum shopping.”

Stephen Raber, a partner at Williams & Connolly in Washington, D.C., filed the motion on behalf of Tyco and Chemguard, both part of Johnson Controls. He did not respond to a request for comment.

Fraser Engerman, a spokesman for Johnson Controls, said in a statement: “Tyco and Chemguard acted appropriately and responsibly in connection with products containing PFOA, including aqueous film forming foams (AFFFs). AFFFs have prevented catastrophic fires and saved many lives, which is why the U.S. military and fire-fighting professionals have chosen to use them for decades and continue to use them today.”

3M attorney Timothy Bishop, a partner at Mayer Brown in Chicago, did not respond to a request for comment.

The lawsuits come on the heels of a $670.7 million settlement with DuPont and Chemours Co. last year involving multidistrict litigation over a related chemical, C8, a type of perfluorooctanoic acid, or PFOA, used to make Teflon and other household items that has been linked to cancer, hypertension in pregnant women and other illnesses.

The new cases focus primarily on foams used at military bases, airports and other sites to fight fuel fires. In 2016, the Environmental Protection Agency issued recommendations on the safe level of those chemicals in drinking water.

Among the New York sites referenced in the complaints are New York Stewart International Airport, Stewart Air National Guard Base, Francis S. Gabreski Airport and East Hampton Airport. Pennsylvania sites involve the Naval Air Station Joint Reserve Base Willow Grove and the Naval Air Warfare Center in Warminster. Two separate complaints mention New Castle Airport in Delaware and Pensacola International Airport in Florida.

Other defendants include National Foam Inc., Buckeye Fire Equipment Co. and United Technologies Corp.’s Kidde division. In a few cases, the defendants include local governments, and a case brought by the city of Newburgh, New York, names the U.S. government, U.S. Department of Defense and U.S. Air Force. In their Sept. 25 motion, Tyco and Chemguard said they anticipated asserting a “governmental contractor defense.”

The cases are a hodgepodge of class actions, individual personal injury lawsuits and actions brought by water districts and other municipal entities. But Tyco and Chemguard want all of them in the same MDL.

“The panel has almost always found that centralization is appropriate in purported environmental contamination cases—including cases involving one of the chemicals at issue in this litigation, PFOA,” Raber wrote, citing the C8 cases.

3M’s motion, filed on Sept. 27, addressed a separate set of cases involving products sold to third parties or manufactured at its own facilities. In its motion, 3M said more than 100 additional cases are pending in state courts in Alabama and Michigan. In February, 3M agreed to pay $850 million to settle a case by the state of Minnesota over water pollution from its manufacturing plant.

Both motions asked to send the cases to U.S. District Judge Denise Casper, who on Dec. 18 dismissed some of the claims in a case brought by Barnstable County, Massachusetts, alleging water contamination from the Barnstable County Fire Rescue Training Academy. As an alternative, they suggest U.S. District Judge Kenneth Karas in the Southern District of New York, who is overseeing four cases, including the city of Newburgh’s case.

The motions come after Jackson ruled against the defendants in the Colorado class action, concluding that the Colorado Supreme Court “would probably recognize a claim for medical monitoring absent present physical injury.” But he agreed that the complaint lacked specifics about medical testing, so he dismissed the medical monitoring claims so that plaintiffs could amend the complaint.

On Monday, Jackson denied a motion the defendants filed to stay the Colorado class action.

In addition to the class action, nearly 7,000 individuals alleging personal injuries have brought more than 40 cases in Colorado that would be part of an MDL, if granted.

Original article can be found here.


UTC Chief Says All Breakup Options on Table; Says Decision by End of Year; Stock Jumps

September 10, 2018

A woman descends in an elevator in Beijing, China, in this 2015 photo. The CEO of parent company United Technologies Corp. says “all options” are being considered to divest non-aerospace businesses such as Otis elevator, a marquee business of UTC. (AP Photo/Alexander F. Yuan, File)

7/25/18

By Stephen Singer, Contact Reporter
Hartford Courant

A willingness by United Technologies Corp. to review “all options” as it considers breaking apart its sprawling business portfolio should cheer investors, two analysts said.

Greg Hayes, chief executive officer, told investor analysts that UTC will “look for ways to maximize value long-term, whether that’s together as the entire UTC portfolio or apart.”

“I think all options are on the table,” he said.

Cowen analyst Cai von Rumohr said Hayes’ comment is a “welcome clarification.”

Previous comments focused on splitting UTC into three units: aerospace, Otis elevator and UTC Climate, Controls & Security.

“A three-way split would increase operational focus but would be a costly, time-consuming process, relinquishing scale pluses with few benefits of new customer access or merger and acquisition opportunities,” von Rumohr said.

Nicholas Heymann of William Blair & Co. wrote in a client note that Hayes’ comments breathed new life into arguments that breaking up UTC will be a boon to shareholders.

“To us, the … ‘all options’ comments likely rejuvenated hope that potential alternative possibilities might now be under consideration that could perhaps more successfully unlock shareholder value,” he said.

“Until yesterday, unlocking shareholder value by spinning out one or more of UTC’s commercial businesses seemed to be increasingly viewed as a less compelling means to create material shareholder value,” Heymann said.

The sale of Otis elevator might be under consideration following a report by Reuters that Thyssenkrupp, a German conglomerate, and Kone, a Finnish company, have discussed a potential merger of their companies’ elevator businesses, he said.

UTC might not stop at unloading Otis if a European deal comes together, Heymann said.

“If this were pursued, the sale of UTC’s Fire & Security business … might also be considered,” he wrote.

A UTC spokeswoman would not comment, deferring to Hayes’ discussion with analysts. Hayes has promised to announce a decision by the end of the year.

The prospect of UTC reducing debt by rapidly selling assets contributed to the nearly 4 percent jump in UTC’s share price Tuesday, Heymann said.

Shares closed up a fraction of 1 percent Wednesday to $134.75.

UTC is set to close before the end of September on its $30 billion acquisition of aerospace manufacturer Rockwell Collins Inc. Following its $18 billion purchase in 2012 of Goodrich Corp., another aerospace manufacturer, UTC will be among the world’s largest aerospace manufacturers, supplying engines, cockpit components, landing gear and other parts and equipment to airline manufacturers.

Investors, particularly activist investors who have recently bought stakes in UTC, question whether shareholders are getting maximum value from UTC as it bulks up on aerospace while operating its other businesses, such as Otis, Carrier heating and cooling and building securities equipment.

Otis elevator is a marquee business of UTC, accounting for nearly 21 percent of UTC’s 2017 revenue of $59.8 billion. But it’s been under pressure in its biggest market, China, which has slowed high-rise construction. In the second quarter, sales were down 6 percent in China. It’s also squeezed by rising commodity prices.

And it was the only UTC business to post a drop in operating profit, down 9.5 percent, to $488 million, in the second quarter. Hayes told analysts that improvements in elevator repair and maintenance service will boost profit margins in the future.

Original article can be found here.


Summit Companies Acquires A-1 National Fire of Nevada

August 26, 2018

8/1/18

Summit Companies

SAINT PAUL, MINNESOTA — Summit Companies, a premier fire and life safety specialist company, announced that it has completed the purchase of A-1 National Fire Co. of Las Vegas, Nevada. This acquisition is a strategic geographic expansion of Summit’s existing fire protection, life safety and consulting business. Summit Companies currently has locations in the states of Arizona, Iowa, Michigan, Minnesota, Nebraska, North Dakota, and Wisconsin and performs work across the United States.

“Summit’s entry into Nevada is in direct alignment with the company’s growth strategy to expand nationally,” stated Summit CEO, Jeff Evrard. “Establishing a presence in Southern Nevada, not only demonstrates Summit’s continued commitment to our customers and to client service excellence, but also expands the organization’s presence in the southwest by complementing our presence in Arizona.”

“We are excited to join the Summit family. As we looked for the right partner to continue our journey it was important to find a partner whose core values aligned with ours,” stated A-1 National Fire Co. Cofounder and President, Ken Young. “Summit is that partner, being prepared, family first, accountable, and a company with high integrity are all important values we both share.”

The company’s roots date back to 1978 when co-owner Mervyn (Merv) Loughmiller started working for a family friend that owned a small fire extinguisher business in Hawaii. In 1991, Merv moved to Las Vegas and started National Fire Protection Company and subsequently purchased a sprinkler company in 2003 renaming the business A-1 National Fire Company. Co-owner Ken Young entered the fire protection business in 1996. In 2003, Ken and his wife Tiffany founded All American Fire to focus on sales and service of portable extinguishers and pre-engineered suppression systems. Ken and Merv merged their businesses in 2006 and renamed the company A-1 National Fire Co.

Today, A-1 National Fire Co. offers the following fire protection and life safety services: fire alarm installation, inspection & repair, kitchen range-hood suppression systems installation, inspection & repair, kitchen exhaust cleaning, fire extinguisher sales, service & installation, fire extinguisher training classes, fire hydrant inspections, testing & repair, back-flow preventer inspections, testing & repairs, fire pump weekly/monthly runs & annual maintenance, and total flood system installation, inspection & repair (halon, alternative clean agents, dry chemical systems, foam systems, CO2 systems). With the additional resources of Summit Companies, the company plans to expand its offering by adding complementary fire life safety services.

About Summit Companies
Summit Companies is a premier Midwest regional Fire Life Safety (FLS) specialist company, with an expanding national presence. The company has expertise across the entire spectrum of fire and life safety categories including: fire extinguishers, extinguishing agents, pre-engineered kitchen, industrial and vehicle suppression systems, special hazard fire protection, fire sprinkler systems, fire alarm and security systems and monitoring. Committed to the design, installation, maintenance, and monitoring of these specialist FLS systems, Summit Companies is also engaged in the practice of fire protection engineering and risk management consultancy. Summit’s success is driven by its people. The company is a culture-first organization that is committed to client service, diversity of capabilities and technical excellence. Summit Companies is owned by management and CI Capital Partners. Learn more at: www.SummitCoUS.com

For more information, contact:
Dave Pelton
Sr. Director, Marketing
Summit Companies
Tel: +1 651 288 0681
Email: dpelton@summitcous.com


Tri State Fire Sued for Damages

July 31, 2018

Firefighters respond in 2015 to a fire at the Gas Light Co. restaurant in downtown Portsmouth. [Rich Beauchesne/Seacoastonline, file]

6/1/18

By Elizabeth Dinan
Seacoastonline

PORTSMOUTH — Contractors blamed in a federal lawsuit for a massive 2015 fire at the Portsmouth Gas Light Co. argued in court filings that restaurant employees were responsible for the blaze that caused more than $1.7 million in damage.

The Patriot and Harleysville insurance companies filed suit against Tri State Hood and Duct, its affiliate Tri State Fire Protection, and Portsmouth Steam of Rye. The insurers claim fire damage at the Gas Light was “caused by the gross negligence, negligence, carelessness and/or negligent acts” by the contractors, who were paid to inspect, maintain and clean the restaurant’s commercial kitchen hood and ducts prior to the fire.

Originally filed as separate lawsuits and now consolidated as one, the litigation seeks to recover the insurers’ costs for claims paid to the Gas Light. In a May 29 filing to the court, by all the parties, it is reported that the Harleysville insurance company paid more than $1 million and Patriot paid more than $750,000 in fire-related claims. The court has assigned the dispute to its “complex” docket and scheduled a trial date of Jan. 22, 2020.

In the newly filed joint discovery plan, the court notes Tri State Hood has reported it worked for the Gas Light to clean kitchen hoods and ducts, but was terminated more than seven months before the fire. The company further contends “the fire was caused by the negligent acts or omissions” of Gas Light employees, “including its kitchen staff.”

Tri State Fire denies liability and informed the court it inspected the Gas Light’s fire-suppression system July 17, 2015, when the system passed the inspection. That company, as well as Portsmouth Steam, alleges the fire was caused by negligence or omissions by Gas Light staff.

Fire Chief Steve Achilles told the Herald, the day of the fire, the blaze started in a duct for a wood-fired oven and burned up through the roof.

Four months after the fire, Gas Light owner Paul Sorli said he had insurance protection for six months of business losses, including keeping his managers on the payroll, while the business was closed. When he reopened a year after the fire, Sorli said it took 12 months, $2.5 million and help from restaurant staff, contractors and a local bank to get the building repaired and the business reopened. Sorli also said the fire suppression system for the wood-fired stove failed to activate.

The original story can be found here.


Trump Targets HFC227 In Chinese Trade War

July 24, 2018

 

To view the original document, as well as the annex that lists all affected products, click here.