The all-stock merger of equals will combine Raytheon (NYSE:RTN), a leading defense company, with United Technologies (NYSE:UTX), a leading aerospace company comprised of Collins Aerospace and Pratt & Whitney, creating a company with combined pro forma 2019 sales of ~$74B.
Raytheon shareholders will get 2.3348 shares in the combined company for each Raytheon share.
Deal excludes Otis and Carrier, which are expected to be separated from United Technologies in H1 2020 as previously announced.
United Technologies shareholders will own ~57% of the combined company, to be called Raytheon Technologies, and Raytheon shareholders will own the remaining 43%.
Raytheon’s Tom Kennedy will be executive chairman of the combined company, and UTX’s Greg Hayes will be named CEO of Raytheon Technologies. Two years after the deal closes, Hayes will assume the role of chairman and CEO.
$18B-$20B of capital is expected to be returned to shareholders in the first 36 months after completion of the merger.
Net debt for the combined company at the time of closing is expected to be ~$26B, with United Technologies expected to contribute ~$24B.
Conference call on June 10 at 8:00 AM ET.