United Technologies CEO Chenevert to Retire -- 2nd Update

By Angela Chen And Ted Mann 

United Technologies Corp. disclosed Monday the sudden retirement of Chief Executive Louis Chenevert, and the industrial conglomerate named Chief Financial Officer Gregory Hayes as his successor.

Lead independent director Edward A. Kangas--who was a former chief executive of Deloitte, Touche, Tohmatsu--has been elected nonexecutive chairman.

The leadership change comes as Hartford, Conn.-based United Technologies has struggled in recent quarters due to weak order growth and disappointing margins.

A company spokesman said the retirement was "entirely unrelated to the financial performance of UTC." The company is on track to hit its earnings guidance for 2014 and will go ahead with a previously scheduled meeting with investors Dec. 11.

"The board has a succession plan for just these reasons," spokesman John Moran said in an email message. "The succession plan has been in place for several years so this should be a seamless transition."

Mr. Chenevert, who joined the company's Pratt & Whitney jet-engine division in 1993, was elevated to president and chief operating officer in 2006. He became CEO in 2008 and was named chairman in January 2010.

Before joining United Tech, he spent 14 years with General Motors Co., eventually becoming production manager at a plant in Quebec.

Mr. Chenevert, who is 57 years old, aimed to focus the company, which makes Otis elevators, Carrier air and heating appliances and Sikorsky helicopters, on two main markets: aerospace and building systems.

In the past few years, he combined a variety of United Tech brands--including Carrier air-conditioning, Chubb security systems and Kidde fire alarms--into a single building and industrial systems segment. In 2012, the company acquired Goodrich Corp., the world's largest manufacturer of aircraft landing gear, in a move that broadened its portfolio of aircraft equipment. During his tenure, the company's share price climbed nearly 50%.

Mr. Hayes, meanwhile, is a 25-year company veteran who has spent six years as finance chief and worked on communications between the board and investors. He joined United Tech in 1999 through its merger with Sundstrand Corp., where he had served as vice president of finance for its aerospace segment. In 2003, he became controller and was promoted to chief financial officer in 2008. He is 54 years old.

Mr. Kangas has been on the UTC board since 2008.

Earlier this year, United Technologies was hit by a pair of high-profile setbacks related to its jet-engine development programs. In May, one of Pratt's new geared turbofan commercial engines suffered a failure while in testing at a Canadian facility of plane-maker Bombardier. And in June, an engine fire temporarily grounded the entire fleet of the Pentagon's new F-35 Joint Strike Fighter, for which Pratt provides the sole engine.

Write to Angela Chen at [e-mail]

Access Investor Kit for General Motors Co.

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US37045V1008

Access Investor Kit for United Technologies Corp.

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US9130171096

Subscribe to WSJ: http://online.wsj.com?mod=djnwires