UTX - Why This Foreign Company Is Buying $2 Billion in Defense Assets
British defense contractor BAE Systems (OTC: BAESY) isn't yet a household name in the U.S., but not for lack of trying. The company is making a major move to increase its presence stateside, announcing plans to spend $2.2 billion to acquire two businesses from merger partners Raytheon (NYSE: RTN) and United Technologies (NYSE: UTX).
The businesses to be acquired include the global positioning system (GPS) United Technologies acquired as part of its 2018 deal for Rockwell Collins, which designs and produces GPS products including anti-jamming and anti-spoofing devices with an installed base of over 1.5 million devices on about 280 platforms. BAE will also buy Raytheon's airborne tactical radios (ATR) unit, which develops secure communications products installed on a broad range of military airborne platforms.
BAE is paying $1.925 billion for the United Technologies business and $275 million for Raytheon ATR.