Raytheon to Sell Texas Aircraft Division for $1.13 Billion

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Raytheon to Sell Texas Aircraft Division for $1.13 Billion

BOSTON (AP) - Raytheon Co. plans to sell its Aircraft Integration Systems division which has sizeable operations in Texas to L-3 Communications for $1.13 billion as it focuses on its core defense business.

Raytheon chairman and chief executive Daniel Burnham said the deal announced Monday would help Raytheon focus on areas like missile defense, surveillance equipment and precision strike weapons systems.

"This transaction provides us financial flexibility and the strategic resources to dedicate to those markets," he said.

The division, based in Greenville, Texas, modifies aircraft and handles maintenance and systems work. Annualized revenue was about $900 million last year.

The division has more than 6,000 employees, including 4,000 in Greenville and 1,500 in Waco, Texas. There was no immediate word on how they would be affected.

L-3, of New York, makes defense and aerospace equipment such as airplane flight recorders and cockpit displays. The company owns the Link Simulation and Training plant in Arlington, Texas, which it bought from Raytheon two years ago.

Lexington-based Raytheon, which has been shedding and consolidating divisions to focus on its core defense business and pay down debt, said the sale would produce a taxable gain but an accounting loss due to goodwill associated with the company's 1995 acquisition of E-Systems.

Raytheon said the deal would be "moderately dilutive" to earnings this year. The company also said it would continue as the lead integrator on the $1.3 billion ASTOR program, an advance airborne radar system.

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I wonder what this sell-out will do to existing .gov/.mil contracts that Raytheon currently has. Someone very close to me, not to mention who, has some planes down there being "upgraded".

-- Anonymous, January 14, 2002


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