Raytheon is to sell its Montek subsidiary to Moog for $160 million cash. Located in Salt Lake City, Utah, Montek supplies aircraft flight control actuation systems, missile steering controls, as well as other products for the aerospace industry.
Montek became part of Raytheon through its acquisition of E-Systems in 1995. Raytheon says that Montek was not considered a core business. The deal is subject to US Government regulatory review, but is expected to be completed in late November.
Meanwhile, Raytheon has completed the divestiture of portions of its electro-optical and focal plane array businesses to DRS Technologies for $45 million in cash. The sale was a government-imposed condition of Raytheon's acquisition of the defence units of Hughes and Texas Instruments.
The products sold to the Parsippany, New Jersey, firm relate to armoured vehicle targeting systems and the Javelin anti-tank missile programme.
The sell-offs come after a sharp third-quarter profits drop at the company, which is the third largest defence contractor in the USA, caused by previously announced restructuring and other charges. Net income fell to $11 million because of $284 million in after-tax charges, compared with earnings of $211 million for the same period a year ago.
The company recently decided to cut its total workforce by 16%, or by 14,000 jobs, over the next two years and to trim or close facilities. Raytheon's earnings were bolstered by the acquisition of the defence units of Hughes Aircraft, which helped to push up its sales in the electronics sector by 58%, to $3.6 billion.
Source: Flight International