Well ? $22.7 billion is certainly a more reasonable price for Rockwell Collins (NYSE:COL) than the $30 billion that was being floated in the press when I recently wrote about the possibility that United Technologies (NYSE:UTX) would bid for it. While no details are yet available, the Wall Street Journalreports that an agreement could be reached as soon as this weekend, and suggests that $22.75 billion ($140/Rockwell Collins share) is the upper limit on pricing.

Assuming:

1. an all-cash deal, which is most likely given Rockwell Collins' higher valuation relative to United Technologies;
2. pricing of $22.75 billion;
3. that United Technologies will not draw down cash but finance entirely with debt; and
4. that United Technologies is able to obtain rates similar to those at which it borrowed in H1, and will seek a similar ten-year weighted average maturity;

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