BAE Systems Expands Electronics Unit With $2.2 Billion Acquisitions -- Update
--BAE Systems is buying Collins Aerospace's GPS business for
$1.93 billion and Raytheon's Radio Business for $275 million
--The units are being sold as part of the Raytheon-United
--BAE shares rose 2.7% in morning trading in London
By Matteo Castia
BAE Systems PLC (BA.LN) said Monday that it is expanding its
electronics system business with assets being sold due to the
upcoming merger of Raytheon Co. (RTN) and United Technologies Corp.
BAE said it is buying Collins Aerospace's Military Global
Positioning System and Raytheon's Airborne Tactical Radios
businesses for a total of $2.2 billion.
The U.K. defense-and-aerospace company said the acquisitions are
focused on areas of highest priority defense spending and will
boost its growth in electronic systems.
The assets are being sold off by Raytheon and United
Technologies as part of their $135 billion combination announced
BAE shares at 0840 GMT were up 16.60 pence, or 2.7%, at 641.20
pence, leading the risers in London's FTSE 100.
The company said it will pay $1.93 billion for Collins
Aerospace's GPS business and $275 million for Raytheon Co.'s radio
business. Collins Aerospace is owned by United Technologies.
Both acquisitions are subject to the closure of the ongoing
merger between Raytheon and United Technologies.
BAE said both businesses benefit from the current political and
national security environment. Specifically, the company added that
the U.S. Congress supports an upgrade to current GPS and radio
capabilities, which represent key areas of U.S. and NATO defense
BAE said that it expects both transactions to immediately add to
earnings and cash with the GPS business generating return on
investment within three years and the radio business within one
Write to Matteo Castia at firstname.lastname@example.org
(END) Dow Jones Newswires
January 20, 2020 04:19 ET (09:19 GMT)
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