Rockwell Collins, UTC CEOs speak with Grassley about acquisition

Senator says he doesn't believe there will be major job losses

The Rockwell Collins headquarters in Cedar Rapids is shown on Tuesday, Sept. 5, 2017. (Liz Martin/The Gazette)
The Rockwell Collins headquarters in Cedar Rapids is shown on Tuesday, Sept. 5, 2017. (Liz Martin/The Gazette)

The chief executives of Rockwell Collins and the avionics company’s proposed acquirer reassured Iowa’s senior U.S. senator this week there should be minimal job losses from the acquisition of Cedar Rapids’ largest employer.

U.S. Sen. Chuck Grassley, R-Iowa, met with the CEOs of Rockwell and United Technologies Corp. about a week after United Technologies said it plans to buy Rockwell for $30 billion. He met with United Technologies CEO Greg Hayes Tuesday and Rockwell CEO Kelly Ortberg Thursday.

“They went through what they were trying to accomplish. Their main job, I felt, was to relieve us of any fears of any major loss of jobs,” Grassley told The Gazette Friday.

Grassley said he generally is skeptical of acquisition announcements given Iowa’s experience with Whirlpool’s 2006 purchase of Maytag in Newton.

“I told them, I start with a premise of what we were promised by Whirlpool when they bought Maytag, that we were promised that there wouldn’t be any jobs lost. Obviously, Newton is without Maytag” now, Grassley said.

Even so, Grassley said Ortberg and Hayes were “totally honest and transparent with us.”

The acquisition of Rockwell still needs to go through regulatory and shareholder approval. The deal is expected to close in the third quarter of 2018.


Company executives already have said they don’t expect major decreases in employment. Job losses, they’ve said, would be concentrated at the executive staff level as Rockwell no longer will be an independent, publicly traded company with its own headquarters.

“I don’t think from an engineering, production, business-unit impact, they don’t do a lot of the same things we do, so I’m not anticipating any significant impact there. It’s probably going to be more around the corporate office, shared-service functions,” Ortberg told Rockwell leadership during a Sept. 12 meeting, according to a transcript filed with the U.S. Securities and Exchange Commission.

If the deal goes through unhindered, Rockwell would merge with a division of United Technologies, UTC Aerospace Systems, to form Collins Aerospace Systems. Ortberg would lead the new division.

The two companies have not yet picked a headquarters location for Collins Aerospace.

“They didn’t say where the corporate headquarters might be, but they didn’t say it wouldn’t be Cedar Rapids. But I never got an indication that it was certain that it would be Cedar Rapids,” he said.

Rockwell has 30,000 employees globally, including 8,000 in Cedar Rapids, where it is based. UTC Aerospace Systems has 40,000 employees and is headquartered in Charlotte, N.C.

Ortberg previously told The Gazette Collins Aerospace Systems would be made up of two-thirds UTC Aerospace Systems and one-third Rockwell.

“We’ve got to sit down and have some discussions. The new Collins Aerospace Systems, recognize about a third of that will be legacy Collins and two-thirds of that will be legacy UTC. As we bring that entity together, that’s the thing that we haven’t made a decision on in terms of where that will be headquartered,” Ortberg said in an interview the day after the acquisition was announced.

On Friday, Grassley said he urged Ortberg and Hayes to keep open Rockwell’s operations in Manchester, Decorah and Bellevue.


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“It’s very important to these small towns. It’s important to Cedar Rapids to have the people employed in Cedar Rapids, but you can imagine in these small towns when you have a company like Rockwell manufacturing there,” Grassley said.

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