"Raytheon Technologies will continue a legacy of innovation with an expanded aerospace and defense portfolio supported by the world's most dedicated workforce", Tom Kennedy, Raytheon Chairman and CEO said, adding that "with our enhanced capabilities, we will deliver value to our customers by anticipating and addressing their most complex challenges, while delivering significant value to shareowners". Hayes will ascend to both roles three years after the deal closes.
Waltham-based Raytheon was founded in 1922 and makes missile and cyber security systems.
United Technologies chairman and chief executive Greg Hayes is expected to lead the combined company while Thomas Kennedy, the chairman and CEO of Raytheon - the fourth-largest USA defense contractor - would be chairman.More news: China may restrict tech access in spiraling USA trade dispute
United Technologies has said it is on track to separate Carrier and Otis in the first half of 2020, leaving the company focused on its aerospace business through its US$23-billion acquisition of Rockwell Collins, which was completed in 2018, and the Pratt & Whitney engines business. A conference call is scheduled for Monday morning. United Technologies is a major player in the aeronautics industry with its Pratt and Whitney engines, which are used in civil and military planes, including the F-35 multi-role stealth fighter jet.
The deal with Raytheon could put pressure on General Electric Co., which also competes with United Technologies for commercial aerospace clients, to seek scale. Another crucial customer is the U.S. Department of Defense.
FILE PHOTO: United Technologies logo is displayed on a screen at the post where it's stock is traded on the floor of the New York Stock Exchange (NYSE) in New York, U.S., September 5, 2017.More news: Cyberpunk 2077 is out next April - and it has Keanu Reeves
Hayes spurned a merger offer from Honeywell International Inc.in 2016, saying the deal undervalued his company and would face customer opposition.
"We don't expect DoD to raise strong objections to the deal", though there may be small divestitures where there's overlap with businesses picked up with the Rockwell Collins purchase, analyst Byron Callan of Capital Alpha Partners wrote in a note Sunday. There is no change to the 2019 financial outlook for either company.
This weekend, Raytheon and United Technologies announced their plans to merge into Raytheon Technologies Corporation, which would become the second largest aerospace company in the world after Boeing, with annual sales expected in the neighborhood of $74 billion. Both Raytheon's and United's board of directors have unanimously approved the merger, which is expected to close during the first half of 2020.More news: Weather warning for heavy rain and floods in Nottinghamshire