United Technologies Corp. and Raytheon have set Oct. 11 for simultaneous special shareholder meetings to vote on their proposed megadeal.
The aerospace companies announced their merger plans June 9 in which UTC shareholders would own 57% of the combined company, which would trade under the stock symbol “RTX.” The deal is valued at $130 billion.
The votes will take place at 8 a.m. Raytheon shareholders also would be asked to approve a nonbinding vote allowing the company to pay certain executives compensation connected to the sale.
The Winston-Salem operations of Collins Aerospace Systems and its 1,500 employees aren’t likely to be affected much if the merger of UTC, its parent company, and Raytheon goes through, according to analysts.
UTC has not commented directly on how the proposed deal might affect its Winston-Salem facilities.
UTC plans to issue 648 million of its shares to Raytheon shareholders as part of the deal. Raytheon stakeholders would receive 2.33 UTC shares for every Raytheon share they own.
The megadeal is projected to close in the first half of 2020, though analysts say it is likely to face significant U.S. and global regulatory headwinds.
The companies said in the regulatory filing they have received two requests for information from the antitrust division of the U.S. Justice Department, the second occurring July 22.
Completion of the merger requires U.S. regulatory approvals or clearances, as well as the go-ahead from the European Union, Australia, Canada, Common Market for Eastern and Southern Africa, Israel, Japan, Republic of Korea, Taiwan and Turkey, and under the foreign investment laws of Australia, France and Germany.
The companies said that as of Tuesday, there have been 10 shareholders lawsuits filed by Raytheon stockholders and one lawsuit filed by a UTC stockholder.
The complaints follow a typical pattern of recent megadeals in each “challenging the adequacy of certain (financial) disclosures made in the joint proxy statement/prospectus.”
In most instances, the companies resolve the complaints by disclosing additional financial details, foremost earnings and revenue forecasts for two to three years if the companies were to remain independent.
Gregory Hayes, UTC’s chairman and chief executive, told analysts in June that he refers to the megadeal as “integrational-lite” because there is little overlap between the companies besides their corporate headquarters.
Hayes would serve as chief executive of the proposed merged company for two years and then take over as chairman with the departure of Thomas Kennedy, Raytheon’s chairman and chief executive.
Hayes said that combining the corporate headquarters in the Boston area is an opportunity to pick the best workforce and that “a significant presence” would remain at UTC’s base in Farmington, Conn.
“This is really not going to affect our businesses or our operations really anywhere,” Hayes told analysts.
Paul Ausick, an analyst for 24-7 Wall Street, said in June that “the Rockwell Collins acquisition (completed in November) was never enough to put United Technologies into this (defense industry) league, and it had to do something to keep from being marginalized.”
The companies project $1 billion in cost savings: $350 million from supply chain and procurement; $325 million from corporate and segment consolidation; $175 million from facilities consolidation; and $150 million from information technology and other selling, general and administrative expenses.
“There will be some facilities rationalization, but we’re not looking to consolidate a bunch of factories, and we’re not taking out a lot of jobs,” Hayes said.
After UTC spins off its Carrier and Otis business segments, which is projected to occur before the completion of the planned Raytheon acquisition, UTC would be focused on aircraft engines and aerospace systems for commercial and defense customers.
Raytheon specializes in defense electronics and mission systems.
According to an analyst presentation, there is one business overlap with UTC’s mission systems unit, listed under the Raytheon intelligence, space and airborne systems umbrella.