Raytheon Buys Applied Signal for $490M

A pretty big merger in defense tech this morning. Waltham, MA-based Raytheon (NYSE: [[ticker:RTN]]) announced it has agreed to acquire Sunnyvale, CA-based Applied Signal Technology (NASDAQ: [[ticker:APSG]]) for $38 per share—about $490 million in cash. The deal is slated to close in the first quarter of 2011, and is not expected to have a material effect on Raytheon’s earnings.

Defense contractor Raytheon made the acquisition to complement its intelligence, surveillance, and reconnaissance technologies, said CEO and chairman William Swanson, in a statement.

Applied Signal, which makes communications, analytics software, and cyberwarfare technologies primarily for government agencies, will be integrated into Raytheon’s Space and Airborne Systems business unit. Advanced sensor systems will be a particular area of interest for the two companies as they move forward together.

Author: Gregory T. Huang

Greg is a veteran journalist who has covered a wide range of science, technology, and business. As former editor in chief, he overaw daily news, features, and events across Xconomy's national network. Before joining Xconomy, he was a features editor at New Scientist magazine, where he edited and wrote articles on physics, technology, and neuroscience. Previously he was senior writer at Technology Review, where he reported on emerging technologies, R&D, and advances in computing, robotics, and applied physics. His writing has also appeared in Wired, Nature, and The Atlantic Monthly’s website. He was named a New York Times professional fellow in 2003. Greg is the co-author of Guanxi (Simon & Schuster, 2006), about Microsoft in China and the global competition for talent and technology. Before becoming a journalist, he did research at MIT’s Artificial Intelligence Lab. He has published 20 papers in scientific journals and conferences and spoken on innovation at Adobe, Amazon, eBay, Google, HP, Microsoft, Yahoo, and other organizations. He has a Master’s and Ph.D. in electrical engineering and computer science from MIT, and a B.S. in electrical engineering from the University of Illinois, Urbana-Champaign.