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Jeff Reeves’s Strength in Numbers: These embarrassing mega-merger flops prove that bigger isn’t always better

The defense industry mega-merger between United Technologies and Raytheon is big news, but is bigger always better?

There are obvious benefits to the deal announced Sunday. United Technologies UTX, -4.35% and Raytheon Co. RTN, -5.38% will combine to create a $100 billion-plus aerospace giant, the second largest in the word behind Boeing Company BA, -1.48% , and put pressure on the Pentagon now that there’s one less bidder for big-ticket contracts. There also isn’t a buyout premium in the cards, so shareholders are being asked to evaluate the deal based on present value and not the promise of big future synergies.

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