Monday, 16 September, 2019

U.S. defense giants Raytheon and United Technologies to merge

United Technologies Corp. said it would merge with defence manufacturer Raytheon Raytheon and United Technologies Agree to Merge into the World's Second Largest Aerospace Company
Ginger Lawrence | 12 June, 2019, 19:46

None the less, Sunday's (June 9th) report of reaching an accord between the two U.S. giants came forth after Saturday (June 8th), a source familiar with the subject-matter had told that there had been an ongoing negotiation between USA defense contractor Raytheon and aerospace conglomerate, United Technologies, over a potential merger.

"We'll supply all the content and all the systems, all of the offensive, defensive capabilities necessary to make the system successful", Hayes told Defense News in an interview published Monday.

"When I hear United and I hear Raytheon, which is another incredible company, the missile systems they make are incredible, when I hear they're merging - does that take away more competition?"

The combined company will be named Raytheon Technologies Corp.

Mr Trump praised both companies and said he hoped a deal can be done, but warned: "I don't want to see where we have one less person that can compete for an order". The two companies together would have about $74 billion in 2019 sales, according to the announcement.

The Defense Department and big customers like Boeing Co, Lockheed Martin Corp and Northrop Grumman Corp will have a lot of clout in the antitrust review, and may worry about over-reliance on one company for a big suite of products. The two firms touted the new company's "expanded technology and R&D capabilities".

The areas of joint advancement include directed energy weapons, intelligence/surveillance/reconnaissance (ISR) in contested environments, cyber protection for connected aircraft, next-generation connected airspace, and advanced analytics and artificial intelligence for commercial aviation.

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The PlayStation version, however, will include early beta access and unique benefits that will be revealed at a future date. The four players co-op mode's "narrative will be delivered over multiple years" as well, Square Enix doubled down.

Combing the companies will result in annual savings of $1 billion by year four, about half of which could go to the U.S. government, the companies said.

Greater heft would enhance the ability of United Technologies to withstand cost pressures from customers such as Boeing Co. and Airbus SE, said Rothacker, the Bloomberg analyst. Mr Hayes will ascend to both roles three years after the deal closes.

"The combination of United Technologies and Raytheon will define the future of aerospace and defense", said Greg Hayes, Chairman and CEO of United Technologies. Approximately 57% of its shares will belong to United Technologies shareowners, with the remaining approximately 43% to Raytheon shareowners.

The combined company's board would have 15 directors - eight from United Technologies and seven from Raytheon. "Before the combination, the lion's share of Raytheon's revenue came from the Pentagon and USA intelligence agencies". Richard Blumenthal, a Democrat from CT, who said he is troubled by the potential impact of the headquarters moving to MA.

In a first sign of opposition, Representative Ro Khanna, a member of the House Armed Services Committee, said he will seek a congressional hearing on the merger and its impact.

Last year, military communication equipment providers Harris Corp and L3 Technologies Inc announced an all-stock merger that, once completed, will create the sixth-largest US defence contractor.