Honeywell-United Technologies Merger Isn't Over, Expert Says

Lisl Dunlop, an antitrust law expert and partner at Manatt, Phelps & Phillips, appeared on CNBC on Tuesday, talking about the United Technologies Corporation UTX - Honeywell International Inc. HON merger.

Looking into the possible antitrust issues that might arise if the companies merged, the specialist believes that advisers -– at least on the Honeywell side -- think "there is a path forward," even though it would imply the need for considerable divestitures in areas like aerospace. In other areas, however, "the whole conglomeration could make sense."

Nonetheless, aerospace is for both companies the most profitable segment "and to spin off one or other of the entire aerospace business might be too much of a chunk to tolerate for either party. So, it could undermine the deal economically."

Having said this, Dunlop pointed out that the main reason that United Technologies cited when it said it did not like the deal were antitrust reasons, rather than economic issues. On the other hand, Honeywell seems the think the deal is not dead yet.

"I think, particularly in the core businesses, both companies are looking for synergies; they are trying to focus on where their profitability is strongest," Dunlop concluded, noting that the companies could see "some significant efficiencies from combining the operations… And that will be one of the major reasons that they are looking to do this deal."

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.