BAE Systems has acquired Collins Aerospace’s Military Global Positioning System (GPS) business, as well as Raytheon’s Airborne Tactical Radio operation.
The asset purchase agreement for the Collins enterprise calls for cash totaling $1.925 billion, with an expected tax benefit of approximately $365 million. Raytheon’s ATR business purchase agreement amounts to $275 million, with an expected tax benefit of roughly $50 million.
“As militaries around the world increasingly operate in contested environments, the industry-leading, battle-tested products of these two businesses will complement and extend our existing portfolio of solutions we offer our customers,” Jerry DeMuro, BAE Systems, Inc. CEO, said. “This unique opportunity to acquire critical radio and GPS capabilities strengthens our position as a leading provider of defense electronics and communications systems, and further supports our alignment with the modernization priorities of the U.S. military and its partners.”
The acquisition proposals are subject to closure of the Raytheon and United Technologies Corporation (UTC) merger in addition to satisfying other customary closing conditions, including receipt of the required U.S. regulatory approvals.
“These are strong businesses with talented employees who share our focus on quality and technology innovation,” Tom Arseneault, president and COO of BAE Systems, Inc., said. “We are confident of a smooth transition that will accelerate our future together and look forward to welcoming these new employees to the BAE Systems team once the transactions are approved.”