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RAYTHEON-HUGHES CREATES $14.5BN SYSTEMS DIVISION

Raytheon Co has now completed its merger with General Motor Corp’s Hughes Electronics Corp division, and out of it formed a new company, Raytheon Systems Co. The $9.5bn acquisition, launched right at the beginning of this year (CI No 3,080), creates one of the largest industrial corporations in the US. William H Swanson becomes chairman and chief executive officer of the new firm, which will be based in Washington DC and will encompass the Hughes defense operations alongside those of Raytheon Electronics Systems, Raytheon-TI Systems (acquired from Texas Instruments Inc just before the Hughes bid) and Raytheon E- Systems. The buy was funded with $4.04bn in debt and $5.46bn in equity. Swanson, who was previously general manager of Raytheon Electronic Systems, will report directly to Dennis Picard, Raytheon’s chairman and chief executive officer. A Lowell Lawson, currently chief executive of Raytheon E-Systems, will retire, and John Weaver, who heads Hughes Aircraft, becomes executive vice president of the Raytheon Co. Raytheon Systems Co will have five divisions: Defense Systems; Sensors and Electronic Systems; Command, Control and Communications; Intelligence, Integration and Aircraft Integration; and Training and Services. It will have revenues of $14.5bn on a 1997 pro forma basis, and Raytheon as a whole will have $20bn in revenues.

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