Raytheon Forms New Travel Company
LEXINGTON, Mass. (AP) _ Raytheon Co. will combine its business that sells partial ownership stakes in airplanes, Raytheon Travel Air, with Cleveland-based Flight Options Inc. to form a new company.
Raytheon said Friday the partnership will allow the new company to capitalize on the growing demand for fractional jet ownership, which allows several owners to own a share of a jet and a fixed amount of annual flight time.
The new company will have more than 1,600 customers and a fleet of more than 200 aircraft.
Under terms of the agreement, Flight Options will hold 50.1 percent ownership of the new company, while Raytheon will hold 49.9 percent.
Raytheon Aircraft Co. will also supply 115 new business jets to the new company, Flight Options LLC, over five years for $900 million.
The new company’s headquarters will be located at Flight Option’s home base in Cleveland. Raytheon Travel Air’s headquarters in Wichita, Kan. will be closed.
Raytheon spokesman David Polk said Raytheon Travel Air’s 700 employees will be offered jobs with the new company.
Heather Dynes, a spokeswoman for Flight Options, said it’s unclear whether the deal will result in job losses because the company has not yet finalized its integration plan.
Raytheon Travel Air, a division of Raytheon Aircraft Co., was founded in 1997. It had $300 million in sales last year.
Flight Options Inc., founded in 1998, is a privately held company with about 800 employees.
In late trading on the New York Stock Exchange, Raytheon shares were up 27 cents at $31.17.
On the Net:
Raytheon site: http://www.raytheon.com