NORTHROP, LITTON DEAL OK MERGED FIRM THIRD-LARGEST IN DEFENSE.Byline: Gregory J. Wilcox Staff Writer WOODLAND HILLS - Defense contractor Noun 1. defense contractor - a contractor concerned with the development and manufacture of systems of defense armed forces, armed services, military, military machine, war machine - the military forces of a nation; "their military is the largest in the region"; Northrop Grumman Northrop Grumman Corporation (NYSE: NOC) is an aerospace and defense conglomerate that is the result of the 1994 purchase of Grumman by Northrop. The company is the third largest defense contractor for the U.S. Corp. said Friday that its $5.1 billion acquisition of Litton Industries Named after inventor Charles Litton Sr., Litton Industries was a large defense contractor in the United States, bought by the Northrop Grumman Corporation in 2001. Inc. won federal regulatory approval and that the deal will close on Monday. The combination creates the nation's third-largest defense contractor with an expected $15 billion in sales this year and 80,000 employees worldwide. Northrop Grumman was previously the fifth-biggest player in its sector. Northrop Grumman had $7.6 billion in revenue last year. The purchase price includes Northrop Grumman assuming $1.3 billion in Litton debt. The Federal Trade Commission approved the deal on Thursday, less than a week after action by the European Commission European Commission, branch of the governing body of the European Union (EU) invested with executive and some legislative powers. Located in Brussels, Belgium, it was founded in 1967 when the three treaty organizations comprising what was then the European Community . Litton, which has about 40,000 employees worldwide, including 3,000 at its Woodland Hills corporate campus, will be a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of Northrop Grumman, headquartered in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. . Litton's Ingalls Ship Systems unit will be a stand-alone operation. The company has three other major units; Advanced Electronics, Electronic Components and Materials and Information Systems. Northrop Grumman announced the deal in late December, saying at the time that it would result in about $100 million in cost savings during the first year. ``Those initial savings will come primarily from the consolidation of Litton's corporate office functions, salaries, benefits and overhead,'' said Northrop Grumman spokesman Bob Bishop. About 250 people work in Litton's headquarters operation but it is too soon to say how many will loose their jobs, he said. The deal closes at 9 p.m. Pacific Time on Monday, and headquarters operations of the new company will soon start consolidating into Northrop Grumman offices in Century City. However, few layoffs are expected as Litton's work force is folded into Northrop Grumman. ``There is very little overlap o·ver·lap n. 1. A part or portion of a structure that extends or projects over another. 2. The suturing of one layer of tissue above or under another layer to provide additional strength, often used in dental surgery. v. between the two companies. Their defense electronics business will meld very closely into ours and their information technology business enhances what we are doing,'' said Bishop. Bishop said Northrop Grumman has about 1,100 job openings, primarily in its defense electronics and information technology units, and that Litton workers will be considered for those positions. Litton officials could not be reached for comment. Defense industry analyst Christopher H. Mecray at Deutsche Banc Alex, Brown Inc. in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of said the regulatory approval process was relatively smooth. ``There have been no particular holdups or extended reviews,'' he said. |
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