UTC, Raytheon Tie-up Gets Conditional DOJ Approval

 - March 27, 2020, 11:33 AM

The United Technologies Corp. (UTC) and Raytheon merger took a step forward yesterday with Department of Justice conditional approval that is contingent upon the sale of Raytheon’s military airborne radios business and UTC’s GPS business. In addition, under the DOJ conditions for approval, UTC must sell its optical systems business in Danbury, Connecticut.

The DOJ action comes less than a year after the two companies announced plans on June 9, 2019, for an all-stock “merger of equals” that would create a $166 billion entity known as Raytheon Technologies. Signed off by both boards of directors in October, the merger would bring together UTC’s Collins Aerospace and Pratt & Whitney businesses with Raytheon’s Intelligence, Space, and Airborne Systems and Integrated Defense and Missile Systems divisions.

The DOJ specified the divestitures to ensure competition remains for military airborne radios and GPS products, as well as for components used in reconnaissance satellites, all of which are used by the U.S. Department of Defense.

BAE Systems announced plans in January to acquire Raytheon’s airborne radios business, which includes facilities in Fort Wayne, Indiana, and Largo, Florida, for $275 million, as well as UTC’s military GPS unit, which currently is based in Cedar Rapids, Iowa, for $1.925 billion. The sale is subject to the closure of the Raytheon/UTC merger, BAE said.