GE to Dealers: Maybe 5 More Years of GE Security Brand

United Technologies Corp. (UTC) sent an email to dealers on Monday, Nov. 16, about its $1.8 billion acquisition of GE Security (full text below).

Beyond the usual platitudes, the letter said little, and not a word about its residential business.

The only potentially interesting bit of the notice was this: "For all product lines there will be a transition period with respect to use of the GE brand. For certain product lines, particularly U.S. intrusion and global video, the deal provides UTC with the right to use the GE brand for an extended period of time, including the right to grant sublicenses to authorized third party resellers for at least five years."

But then, we already knew that.

While UTC reserves the right to perpetuate the GE Security brand for some time, however, the company has not stated if they would actually use it.

Meanwhile, GE Security dealers in the GE Home Technologies Group, managed by the AIN Group, fret that GE may pull the substantial funding it provides to the organization.

In addition to the dealers, other CE-related vendors involved with the program -- including Sony, Control4, Klipsch and Legrand (formerly OnQ) -- rely on GE's investment in the group.

Neither UTC or GE Security has spoken publicly about its plans for the residential market or its channel partners, other than to say -- surprise surprise -- that UTC "remains committed to the company's independent channel partners"

The deal should close in mid-2010.

Dear valued customer:

As a valued customer we are pleased to let you know that GE and United Technologies Corporation (UTC) have signed a definitive agreement for UTC to acquire the GE Security business. The transaction will be subject to customary regulatory approvals. We anticipate the close will be in early to mid-2010.

GE Security is a natural fit with the UTC Fire & Security business as the Security industry is core to both businesses' growth strategy. The combination of UTC's existing product portfolio and GE Security's outstanding, highly complementary products creates a broad set of offerings for our customers and partners.

This transaction creates a strategic alliance that not only has breadth and depth of offerings, but a global reach and a commitment to investing in new product technologies that will serve a broad range of industry segments to help you compete and win. UTC's plans are to continue to support legacy and current products and services. For all product lines there will be a transition period with respect to use of the GE brand. For certain product lines, particularly U.S. intrusion and global video, the deal provides UTC with the right to use the GE brand for an extended period of time, including the right to grant sublicenses to authorized third party resellers for at least five years.

This acquisition is synergistic with UTC's strategy of providing equipment and systems to commercial buildings, and expands its core capabilities to drive interoperability between building, fire safety and security management solutions.

Upon close, UTC, headquartered in Hartford, CT, will maintain GE Security's global operations. UTC intends to continue to manage and develop the product and integrator platforms separately and remains committed to the company's independent channel partners.

If you have any questions, please do not hesitate to contact your sales representative or us. We look forward to continuing to serve you.

Best Regards,

Dean Seavers
[GE Security president and chief executive officer]