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Starboard questions Rockwell Collins' B/E Aerospace deal: source
November 30, 2016 / 11:05 PM / 10 months ago

Starboard questions Rockwell Collins' B/E Aerospace deal: source

Jeffrey Smith, Managing Member, CEO and Chief Investment Officer for Starboard Value LP., speaks at the Sohn Investment Conference in New York City, U.S. May 4, 2016. REUTERS/Brendan McDermid

(Reuters) - Activist investor Starboard Value LP has acquired a stake in aircraft component maker Rockwell Collins Inc (COL.N) and is questioning its $6.4 billion purchase of B/E Aerospace Inc BEAV.O, a person familiar with the matter said on Wednesday.

Bloomberg reported earlier on Wednesday, citing sources, that Starboard had asked Rockwell Collins to explore alternative options, including selling itself. Rockwell Collins has yet to receive any formal letter from Starboard, the source said.

The source asked not to be identified because the matter is confidential.

Rockwell’s shares were up 2.7 percent at $95.20 in extended trading on Wednesday, while B/E Aerospace was down 3.4 percent at $58.00.

“We remain confident that the acquisition of B/E Aerospace will create significant value for our shareholders,” a Rockwell spokeswoman said.

“We’re excited to bring together these two industry leaders and look forward to closing this transformative transaction in the spring of 2017.”

In October, Rockwell Collins struck a deal to buy aircraft interior maker B/E Aerospace, to expand the range of products Rockwell Collins supplies to major commercial and business aircraft.

The companies have little product overlap, with Rockwell best known for avionics, flight controls and cabin connectivity, while B/E Aerospace is a major provider of aircraft seats, galleys, lighting and other systems.

Starboard and B/E Aerospace did not immediately respond to requests for comment.

Up to Wednesday’s close, Rockwell’s shares had risen about 10 percent since Oct. 21, the last trading day before the deal was announced, while B/E Aerospace’s increased about 19 percent.

Reporting by Ankit Ajmera in Bengaluru and Greg Roumeliotis in New York; Editing by Lisa Shumaker and Shounak Dasgupta

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