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Raytheon sheds Amana
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July 14, 1997: 10:42 a.m. ET
Defense giant to sell three out of five appliance group segments for $550M
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NEW YORK (CNNfn) - Raytheon Co., as part of its effort to refocus on the defense sector, said on Monday it agreed to sell three out of five divisions that make up its appliance business.
The Lexington, Mass.-based company will sell its home appliance (including the Amana brand name), heating and air conditioning, and commercial cooking segments to closely held Goodman Holding Co. of Houston for $550 million in cash.
Separately, $200 million of the group's receivables were also sold to unidentified banks, the company said.
The transaction is consistent with the company's realignment strategy announced in February. Raytheon, which invented the microwave 50 years ago, said it will continue to assess its other two appliance business segments: commercial laundry equipment (which includes the Speed Queen brand name) and electronic controls.
The assessment "could result in the sale of commercial laundry and electronic controls. But even if we don't they are very profitable," said Robert McWade, company spokesman.
The two segments being retained account for about 20 percent of overall revenue and half of the appliance group's profits. About 5,500 workers, or 70 percent of the appliance group's total work force, will be affected by the sale.
Raytheon said the deal is not subject to shareholder approval. However, regulators still need to clear the transaction. The sale is expected to close in the third quarter.
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Raytheon
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