Business Acquisitions and Dispositions. During the first nine months of 2011, our investment in business acquisitions was $229 million and consisted of a number of smaller acquisitions in both the aerospace and commercial businesses. As a result of Sikorsky's contribution of a business into a new venture in the United Arab Emirates, we recognized a gain of approximately $73 million in the second quarter of 2011.

On September 21, 2011, we announced that we entered into an agreement to acquire Goodrich Corporation (Goodrich), a global supplier of systems and services to the aerospace and defense industry with 2010 sales of $7 billion. Under the terms of the agreement, Goodrich shareholders will receive $127.50 in cash for each share of Goodrich common stock they own at the time of the closing of the transaction. This equates to a total current enterprise value of $18.4 billion, including $1.9 billion in net debt to be assumed. Of the total $16.5 billion required, we expect to finance the transaction through a combination of debt and equity issuances, with the equity component expected to approximate 25% of the total financing (other than the amount of net debt assumed). The transaction is subject to customary closing conditions, including regulatory and Goodrich shareholder approval. We expect that this acquisition will close in mid-2012. Goodrich products include aircraft nacelles and interior systems, actuation and landing systems, and electronic systems. Once the acquisition is complete, Goodrich and Hamilton Sundstrand will be combined to form a new segment named UTC Aerospace Systems. It is expected that the increased scale, financial strength and complementary products of the new combined business will strengthen our position in the aerospace and defense industry. Further, this acquisition will enhance our ability to support our customers with more integrated systems.

On October 12, 2011, Pratt & Whitney and Rolls-Royce announced a restructure of their participation in IAE International Aero Engines AG (IAE), which produces the V2500 engine for the A320 family of aircraft. Under the terms of the agreement, Rolls-Royce will sell its equity and program shares in IAE and license its V2500 intellectual property in IAE to Pratt & Whitney for $1.5 billion and an agreed payment for each hour flown by the current installed fleet of V2500-powered aircraft during the fifteen year period following completion of the transaction. These licensing rights will be perpetual, worldwide, and permit Pratt & Whitney to sublicense, as necessary. The acquisition of the additional shares in IAE will give Pratt & Whitney a controlling interest with 66% ownership. Pratt & Whitney intends to offer a portion of its interests to the remaining IAE partners MTU Aero Engines AG (MTU) and Japanese Aero Engines Corporation (JAEC). Upon closing, we anticipate Pratt & Whitney will begin consolidating IAE. The acquisition of the collaboration rights and intellectual property licenses will be reflected as intangible assets and amortized in relation to the economic benefits received over the projected remaining life of the V2500 program.

Pratt & Whitney and Rolls-Royce also announced an agreement to form a new venture to develop engines to power future new mid-size aircraft (120 – 230 passenger aircraft). The two companies will establish a joint venture company, in which each will hold an equal share, to develop new engines for the next generation of mid-size aircraft. This new joint venture will focus on high-bypass ratio geared turbofan technology. In addition, the venture will collaborate on future studies for next generation propulsion systems. These announced transactions with Rolls-Royce are subject to various closing conditions, including regulatory approvals and are expected to close in mid-2012.

Goodwill. Changes in our goodwill balances for the first nine months of 2011 were as follows:

(Dollars in millions)		Balance as of January 1, 2011		Goodwill resulting from business combinations		Foreign currency translation and other		Balance as of September 30, 2011
Otis		$	1,470	$	45	$	(5)	$	1,510
Carrier			3,171		35		(51)		3,155
UTC Fire & Security			6,646		35		(33)		6,648
Pratt & Whitney			1,224		-		4		1,228
Hamilton Sundstrand			4,491		(10)		(5)		4,476
Sikorsky			330		-		(4)		326

Total Segments			17,332		105		(94)		17,343
Eliminations and other			389		258		(10)		637

	Total	$	17,721	$	363	$	(104)	$	17,980

For the nine months ended September 30, 2011, we recorded an additional $258 million of goodwill, reflected within “Eliminations and other” in the above table, related to the finalization of purchase accounting associated with the December 2010 acquisition of Clipper Windpower Plc (Clipper).

We early adopted the Financial Accounting Standards Board's (FASB) Accounting Standards Update (ASU) No 2011-08, “Testing Goodwill for Impairment,” in connection with the performance of our annual goodwill impairment test. Under ASU 2011-08, entities are provided with the option of first performing a qualitative assessment on none, some, or all of its reporting units to determine whether further quantitative impairment testing is necessary. An entity may also bypass the qualitative assessment for any reporting unit in any period and proceed directly to the quantitative impairment test. We completed our annual impairment testing in the third quarter of 2011 and determined that no significant adjustments to the carrying value of goodwill or indefinite lived intangible assets were necessary based on the results of the impairment tests.

Intangible Assets. Identifiable intangible assets are comprised of the following:

			September 30, 2011				December 31, 2010
(Dollars in millions)			Gross Amount		Accumulated Amortization		Gross Amount		Accumulated Amortization
Amortized:
	Service portfolios		$	2,042	$	(1,051)	$	1,950	$	(942)
	Patents and trademarks			468		(179)		441		(153)
	Other, principally customer relationships			3,311		(1,384)		3,229		(1,222)

				5,821		(2,614)		5,620		(2,317)

Unamortized:
	Trademarks and other			759				757

		Total	$	6,580	$	(2,614)	$	6,377	$	(2,317)

Amortization of intangible assets for the quarter and nine months ended September 30, 2011 was $102 million and $304 million, respectively, compared with $104 million and $283 million for the same periods of 2010. Average amortization of these intangible assets for 2011 through 2015 is expected to approximate $315 million per year.