The New York-based hedge fund, which owns a $1-billion stake in the Connecticut conglomerate, signalled to its clients that it would step up pressure on the board and management to follow through on promises to review the company's future.

Loeb wants the company to split into three businesses: the Climate, Controls & Security division, Otis elevators, and an aerospace company (“Aerospace RemainCo”) encompassing UTAS and Pratt & Whitney. It also would include Rockwell Collins Inc, which United Technologies is acquiring.

"A three‐way split would unlock in excess of $20 billion of value, net of separation costs," Third Point said in a letter to clients seen by Reuters on Friday.

"Third Point did not invest in UTC for what it is today but for what it could become," the letter said, adding that the fund planned to work constructively with the company.

United Technologies shares were up 1.5 percent at $119.50.

The company said it welcomed input from shareholders but disagreed with some of the hedge fund's points, possibly exposing areas of conflict between the two sides.

Loeb said management may be dragging its heels.

"UTC's management has acknowledged the disconnect between the company's intrinsic value and share price but it seems less open to a three‐way split solution than shareholders might expect," the letter said.

In March, UTC Chief Executive Greg Hayes put a price tag of as much as $3 billion on splitting the company apart, and said it could take two years to complete.

But Loeb said on Friday it could be done for less, putting the figure for refinancing debt that matures between 2020 and 2027 at around $200 million.

Loeb has a history of sparring with chief executives, including those at Dow Chemical, Sotheby's and Yahoo, and his firm's involvement at United Technologies comes at a time when conglomerates are fighting to justify their existence.

Hayes has told investors several times that United Technologies plans to conduct a portfolio review that will include considering a three-way breakup, if appropriate, to unlock value for shareholders.

People familiar with United Tech's thinking say executives currently need to concentrate on closing its $30-billion acquisition of Rockwell Collins, which it agreed last year, and that focusing on a breakup now could be a distraction.

Loeb is not the only activist investor in United Tech. Earlier this year, William Ackman said his Pershing Square Capital Management was also invested. So far, Ackman, an often-voluble investor, has said nothing about the company.

(Additional reporting by Arunima Banerjee; Editing by Nick Zieminski and Bernadette Baum)

By Svea Herbst-Bayliss and Alwyn Scott