Many of you remember what happened when Raytheon merged/bought TI, Hughes and E-Systems. This current merger is huge. We suspect that there will be similar growing pains as the pieces figure out how to work together. Of course, this current press release is very brief and there will be much more data over the next few weeks. Also, some approvals will be required. We will strive to keep you informed.
John and Mel
Co-presidents ARR
Dear Raytheon colleague,
Today is an exciting day for our company and one that brings with it tremendous opportunity for our future success.
This afternoon, we announced that Raytheon will merge with United Technologies Corporation (UTC). The combined company will be called Raytheon Technologies Corporation. This merger of equals will create a leading aerospace and defense systems supplier with a diversified technologies portfolio able to meet the growing capabilities demand from our global customer base.
UTC provides advanced technologies and services to the aerospace and defense industry that are highly complementary to our existing business. Its Collins Aerospace and Pratt & Whitney business units have over $45 billion in annual revenue and employ about 115,000 employees at more than 400 locations in 50 countries around the world. As UTC previously announced, its Carrier and Otis business units will be separated from the company prior to closing and will not be a part of our merger.
I will assume the role of Executive Chairman of the combined company and Greg Hayes, the current Chairman and CEO of UTC, will serve as the CEO of the combined company, once the transaction is closed. The Board of Directors of the combined company will consist of 15 of the existing directors of Raytheon and UTC, including Greg Hayes and myself. The leadership teams of both companies will be consolidated and combined, and announced in the coming months. We will be headquartered in the greater Boston-metro area and will maintain a corporate presence at current company locations. We expect the merger to be completed in the first half of 2020, subject to approval by the shareholders of each company, receipt of required regulatory approvals and satisfaction of other customary closing conditions, as well as completion by UTC of the separation of its Carrier and Otis businesses.
Upon completion of the merger, we will consolidate our four business units, consisting of Integrated Defense Systems (IDS), Intelligence, Information and Services (IIS), Raytheon Missile Systems (RMS), Space and Airborne Systems (SAS) and Forcepoint, into two businesses. The new businesses, which will be comprised of an IDS/RMS and IIS/SAS/Forcepoint consolidation, will be renamed Integrated Defense & Missile Systems and Intelligence, Space & Airborne Systems, respectively. They will join Collins Aerospace and Pratt & Whitney as the four primary business units of Raytheon Technologies. The combined company is expected to be the world’s preeminent aerospace and defense systems supplier, ranking in the top 50 of the Fortune 500, with annual revenues of approximately $74 billion and over 180,000 employees worldwide.
This “merger of equals” will create new opportunities for growth across the company and aligns directly with our strategy to focus on top-line growth and global market expansion. Once combined, Raytheon Technologies will offer some of the world’s most advanced technologies in the areas of avionics, military and commercial aircraft propulsion, integrated air and missile defense, and space, sensor and intelligence platforms.
Until this merger is completed, I ask each of you to focus on the important work of meeting our current customer, shareholder and community commitments. It’s vitally important that we do not let the merger distract us from fulfilling our current business commitments. A working group will be formed to manage integration activities, and new teams will be named shortly to begin planning for business consolidation. My commitment to each of you is that we will keep you informed and updated as the transaction progresses. In addition to ongoing messaging from myself and leadership via oneRTN, you can visit the merger microsite on Raytheon.com. Please visit these sites frequently for updates on merger activities and information.
For 97 years, Raytheon has provided mission-critical technologies to our customers, supported a diverse and engaged workforce, and has been a good corporate citizen. That legacy, built on a foundation of trust, respect, collaboration, innovation and accountability, will continue. We are becoming a larger company, and our common vision remains the same: to create the trusted, innovative solutions to make the world a safer place.
Respectfully,
Tom
You might also be interested in this article from Defense News: https://www.defensenews.com/industry/2019/06/10/why-the-new-raytheon-technologies-will-eschew-platforms-for-new-technology-development/