Safran nears $1.8 billion deal to acquire Raytheon's flight controls unit-source

Woodward

14/06/2023 13:20

By David  Carnevali
       June 14 (Reuters) - French aerospace engine maker Safran
SA  SAF.PA  is nearing an approximately $1.8 billion deal to
acquire a Raytheon Technologies Corp  RTX.N  unit that makes
flight controls for aircraft, helicopters and missiles,
according to a person familiar with the matter.
    The deal rids Raytheon of a low-margin business it inherited
from its $120 billion merger with United Technologies three
years ago, while expanding Safran's foothold in flight controls
against rivals such as Moog Inc  MOGa.N , Eaton Corp  ETN.N ,
Woodward Inc  WWD.O  and Parker-Hannifin Corp  PH.N .
    Safran may reach a deal to acquire Raytheon's actuation
business that makes flight controls as early as this week, the
source said, asking not to be identified because the matter is
confidential.
    Spokespeople for Safran and Raytheon did not immediately
respond to requests for comment.
    Safran said on June 5 it was participating in a "competitive
process" for Raytheon's flight controls business, without
commenting on the chances of an agreement or the terms of a
deal. It was responding to a Bloomberg News report that revealed
Raytheon was in advanced negotiations with Raytheon about the
transaction.
    The deal with Raytheon represents Safran's largest
acquisition since its $7.7 billion purchase of French aircraft
seat maker Zodiac Aerospace in 2018 and is the biggest under
Safran CEO Olivier Andries, who took over in 2021.
    The Raytheon business will strengthen Safran's ties with
Airbus SE  AIR.PA , since it sells into many of its commercial
aircraft and has some operations in France. It will also expand
Safran's relationship with the U.S. military, selling into F-35
and V-22 aircraft.
    The actuation unit was previously owned by Rockwell Collins,
a company sold to United Technologies in 2018. Raytheon CEO Greg
Hayes has been seeking to streamline its Collins Aerospace
business, transferring some offerings to and from other
divisions, as he positions it to benefit from airlines putting
in more aircraft orders in the wake of strong travel demand. 

 (Reporting by David Carnevali in New York, Editing by Louise
Heavens)
 ((Greg.Roumeliotis@thomsonreuters.com; +1 646 223 6022; Reuters
Messaging: greg.roumeliotis.thomsonreuters.com@reuters.net))