The giants Raytheon and United Technologies merge: new opportunities for aviation

Raytheon and United Technologies announced their intention to merge on June 9, 2019, in order to pool their expertise in their respective fields. The two giants of defence and aeronautics will constitute one of the largest groups in the sector. Raytheon alone has a total revenue of 27 billion dollars.

The two company create a giant (credits:AFP/Getty Images)

A huge merger

This merger is expected to be fair for both companies. The method would be an exchange of shares. Under the agreement, United Technologies' shareholders will hold approximately 57% of the capital of the merged company and Raytheon's shareholders will hold approximately 43%. The boards of directors of Raytheon and United Technologies unanimously approved the merger, which is expected to be completed in the first half of 2020.

"Raytheon Technologies will continue its tradition of innovation by expanding its aerospace and defense offerings with the support of the most dedicated workforce in the world," said Tom Kennedy, current President and CEO of Raytheon. The latter will be at the head of the new company.


The new defence and aerospace company would only be surpassed by Boeing in the United States, according to the latest Forbes 500 ranking based on annual revenues. On this list, Boeing had sales of more than $101 billion and another rival, Lockheed Martin, had sales of $53.7 billion, according to Forbes.

Two aviation giants

Raytheon is a company specialized in various fields including aerospace, armament and cybersecurity. The company produces missiles and various military navigation and fleet control systems. In addition, it designs detectors, sonars and on-board radars.

United Technologies is also a giant. The aeronautics sector is very important for it: it accounts for nearly a quarter of its annual revenue (23.6%) as well as the air navigation systems sector, which represents 22.4% of its activities.

This American conglomerate includes Rockwell Collins, now part of Collins Aerospace, which provides avionics, communication systems, in-flight entertainment and cabin design. In addition, United Technologies is made up of the engine manufacturer Pratt & Whitney, one of the 4 largest groups in this sector. It is present both in the commercial aviation sector (as on the A320) and in the military (it equips Lockheed Martin's F-35 Lightning II).

A Pratt&Whitney engine on an A320 

The objectives announced by the new group are as follows:
-Establish a balanced and diversified portfolio with complementary A&D technologies
Combine complementary technological offerings and world-class engineering teams
Provide innovative and cost-effective solutions adapted to customer priorities
-Create an attractive financial profile with strong cash flow generation and a solid balance sheet.

New opportunities

Combining its production capacities and above all its Research and Development skills makes it possible to imagine new technical solutions. To mention only two fields of application, aircraft cybersecurity: United Technologies provides aircraft networks and information management systems and Raytheon provides detection, defence and reaction as well as security tests, with fault detection.

A Collins Aerospace cockpit 

Another opportunity, concerning artificial intelligence in aviation. United Technologies has developed a very large network, with detailed flight and environmental data, making it possible to forecast and monitor aircraft.
Raytheon's analytical, AI and machine learning skills with pattern recognition are added.

Raytheon and @UTC aerospace businesses will combine in a merger of equals. The new Raytheon Technologies will be a premier systems provider with an innovative tech portfolio that addresses the rapidly growing segments of A&D: https://t.co/oxbAwaVOl1 pic.twitter.com/TJloaoeNbP

— Raytheon (@Raytheon) June 9, 2019

More information on the company’s website