Sikorsky, via Associated Press

United Technologies has agreed to buy the Goodrich Corporation for $16.4 billion in cash, the companies said late on Wednesday, in an effort to expand in the fast-growing commercial aviation business.

Related Links The press release

Under the deal’s terms, United Technologies will pay $127.50 a share, a 16 percent premium to Goodrich’s closing price on Wednesday. It is also a 47 percent premium to the company’s closing price on Sept. 15, before reports of a potential deal emerged.

The deal, the largest by United Technologies in recent memory, would add another major component to a portfolio that already includes Sikorsky helicopters, Pratt & Whitney jet engines and Otis elevators. The combined company is expected to have $66 billion in global sales this year.

Dima Gavrysh/Associated Press

Goodrich will be added to United Technologies’ existing aerospace division and will continue to be led by its chairman and chief executive, Marshall Larsen. United Technologies said that it expected the deal to begin adding to its earnings in the second year after closing.

Directors of both companies met late on Wednesday to approve the deal. The deal is being supported by about $15 billion in financing from a lending group led by JPMorgan Chase and including HSBC and Bank of America Merrill Lynch.

A deal by United Technologies is the latest by a company seeking growth through acquisitions, at a time when companies have been hard-pressed to increase their profits internally. Financing remains relatively cheap for borrowers with strong credit ratings, while many companies have been holding billions of dollars in cash on their balance sheets.

In 2009, the company bought General Electric‘s fire alarm and security systems unit for $1.8 billion. In 2008, it began a hostile bid for Diebold, a maker of automated teller machines and security systems, but called off its efforts after the financial crisis.

United Technologies was advised by JPMorgan and Goldman Sachs, while Goodrich was advised by Credit Suisse and Citigroup. United Technologies received legal advice from the law firm Wachtell, Lipton, Rosen & Katz, while Goodrich was counseled by Jones Day.