Raytheon (RTN)
And
Textron (TXT)

Raytheon (RTN)
Mission statement: “Aspiring to be the most admired defense and aerospace systems supplier through world-class people and technology”. (Raytheon.com)
Background and History Raytheon was founded in Cambridge, Massachusetts in 1922, as the American Appliance Company, by Laurence K. Marshall, Vannevar Bush, and Charles G. Smith. Marshall and Bush were engineering students, while Smith was an inventor and scientist, but they were all entrepreneurs. After failures to market an idea for a new refrigerator the trio began to focus on electronics. (Raytheon, Wikipedia.com) An idea that Smith and Bush had worked on years earlier, “a new kind of gaseous tube that would allow radios for the first time to be plugged into a wall socket and operate on electricity rather than batteries”, would be their new direction. (Raytheon Company, fundinginguniverse.com) After acquiring a patent for the idea and because an Indian company already had rights to the name American Appliance Company, Raytheon Manufacturing Company was born. (Raytheon Company, fundinginguniverse.com) The consumer demand for electronics was booming and the new radio-receiver power supply (gaseous rectifier), which immediately allow radios to be in every household for pennies of what it cost to continuously replace batteries. (History, Raytheon.com) As the competition for radio-receiving tubes began to intensify Raytheon, mainly Laurence K, Marshall, saw the need to diversify. (Raytheon Company, fundinginguniverse.com) Raytheon’s philosophy soon became to acquire companies that could take Raytheon to new heights in the competitive electronics market and to reinvest profits back into the company for research and to development and improve products. They acquired Acme-Delta Company in1933 a producer of transformers, power equipment, and electronic auto parts and Raytheon soon became “the world's largest vacuum tube manufacturing companies”. (Raytheon, Wikipedia.com) During World War II Raytheon had the opportunity to help Allied Forces with the mass production of magnetron tubes, which improved the capability of radar to detect enemy planes. As the war ended Raytheon continued to search for acquisition opportunities in an attempt “to consolidate independent component manufacturers into one company”. (Raytheon Company, fundinginguniverse.com) They acquired Belmont Electronics, who was developing televisions for commercial use, for $4.6 million in 1945 and Russell Electric for $1.1 million later the same year. (Raytheon Company, fundinginguniverse.com) A merger with Submarine Signal Company in 1946 helped Raytheon make it thru tough times after WWII and it “was decided that Sub-Sig would specialize in sonar devices and that Raytheon would continue to develop new radar systems”. (History, Raytheon.com) The relationships Raytheon developed during WWII helped it grow the company and the productions of magnetron tubes lead them to their next great invention, the ability to use microwaves to cook food. In 1947 Raytheon demonstrated the first microwave, but it was their acquisition in 1965 of Amana Refrigeration, Inc, a manufacturer of refrigerators and air conditioners that made the microwave oven actually affordable and 1967, “Raytheon introduced the first countertop, domestic 100-volt microwave oven”. (History, Raytheon.com) The microwave brought great profits to Raytheon. This led to acquisitions of many more companies over the next decade. In 1948 Raytheon developed the first missile guidance system “in which both the radar transmitter and receiver were carried in the nose of the missile itself. (History, Raytheon.com) This lead to Raytheon receiving a contract from the U.S. Army in 1967 to develop its much needed missile defense system, later named the Patriot Missile System. The missile guidance system, much in demand during the Cold War of the 70’s and 80’s and Persian Gulf Wars, became a major part of Raytheon’s business. Raytheon has continued to acquire companies, including Beech Aircraft in 1980 and the defense businesses of Texas Instruments Inc. in 1997, it deems necessary to achieve its goals and expand its business. Raytheon is currently composed of six major business divisions: * Integrated Defense Systems * Intelligence and Information Systems * Missile Systems * Network Centric Systems * Raytheon Technical Services Company LLC * Space and Airborne Systems
(wikinvestment.com)

Raytheon’s current CEO and Chairman, William H. Swanson, was named CEO in 2004. He graduated from California Polytechnic State University with a bachelor’s degree in industrial engineering and acquired his MBA from Golden State University. (Leadership, Raytheon.com) He joined Raytheon in 1972 and held a “wide range of leadership positions, including manufacturing manager of the company’s Equipment Division, and general manager of Raytheon Electronic Systems” . (William H, Swanson, wikipedia.com) Swanson is the member of numerous military advisory boards and continues Raytheon’s pursuit to be the leading supplier for defense systems and continued innovations. He has continued to acquire companies that will allow Raytheon to achieve its goals more efficiently. Raytheon’s November 4 acquisition of Trusted Computer Solutions (TCS), an industry leader in cross-domain and cyber security software and services, and acquiring Technology Associates Inc, a company that delivers full life-cycle computer engineering to mission-critical programs in the U.S. intelligence community, in October 2010, are examples of Swanson continuing the philosophies of Raytheon’s founders. (Leadership, Raytheon.com)

Textron (TXT)
Mission statement: “to be one of the World's Best Managed companies; Excellent Managers of Shareholder Resources; A Multi-Industry Company with Global Leadership Positions in Each of Our Businesses”. (Textron Inc., fundinguniverse.com)
Background and History Textron was founded by Royal Little in 1923, as the Special Yarns Corporation in Boston, Massachusetts and was a textile company. A Harvard Graduate, Royal Little was an outspoken advocate for “non-related” diversification, so any down turns of one business would have minimal to no affect on other components of the company. (Textron Inc., fundinguniverse.com) With the acquisition of Franklin Process Company, a cotton yarn processing company in 1928, they became the first multi-industry company. (Textron, Wikipedia.com) Changing its name to Atlantic Rayon Corporation during World War II, business flourished from the demand for parachutes. (Company History,Textron.com) Little was extremely hands on and as revenue slowed at the end of WWII he moved to producing lingerie and other consumer goods. (Textron.com) In 1943 the name was changed to Textron and in 1947 it was listed on the New York Stock Exchange. Royal Little was known for hostile takeovers and his “irrepressible impulses to acquire more companies”. (Textron Inc., fundinguniverse.com) In 1956, in an attempt to balance his own business style, Little hired banker Rupert Thompson. This partnership became known as the first conglomerate. (Textron Inc., fundinguniverse.com) Thompsons’ main objectives, as the director and head of Textron’s non-textile operations and as Little’s successor, were to balance Textrons’ acquisitions and minimize the affects an economic downturn in one portion of company would have on the rest of the company. Thompson believed the company should sell any division of the company at the first sign of adverse performance and this included the selling of Textrons last textile holding, Amerotron, in 1963. (Textron Inc., fundinguniverse.com) Through the 60’s and 70’s Textron made many more acquisitions. Perhaps the most impressive was the purchase of Bell Aircraft Company for $32 million in 1960. Bell was best known for its helicopters, it gave Textron entrance into the aerospace industry, and Bell Aerospace became the name of this Textron division. (Textron, Wikipedia.com) Royal Little also retired at the end of 1960, but with Rupert Thompson taking over Textron continued growth through acquisition. In 1984 Textron acquired Avco Corporation which doubled the size of Textron and in 1992 the acquisition of Cessna Aircraft Company balanced the Bell Aerospace division’s defense-related business activity. (Company History, Textron.com) Textron has been consistent in acquiring companies that offer complementary products, markets, or manufacturing processes and this has allowed them to easily merge their various companies into one large division. Examples of this are their Textron Automotive Company which merged six different automotive businesses and Textron Fastening Systems Inc. which merged five fastening companies. (Company History, Textron.com) Textron currently consist of the following five major business divisions: * Cessna (32%) * Bell (27%) * Textron Systems (18%) * Industrial (12%) * Finance (11%)
(wikinvestment.com)

Textron’s current CEO and chairman is Scott C. Donnelly. He has been with Textron since2008 and became CEO in December of 2009. Donnelly, who was formerly the president and CEO for General Electric (GE) Aviation, got his Bachelor of Science degree in electrical and computer engineering from the University of Colorado. (Company History, Textron.com) Donnelly’s’ philosophies are similar to Textron’s past CEO’s as he continues to implement restructuring and new product development. His work with GE Global Research, the world’s largest and most diversified industrial research organization, will help him keep Textron diversified, which was always the goal of the founder.

What Raytheon and Textron have in common? * Both companies were founded in the early 1920’s, grew and thrived through the great depression, and both were founded in Massachusetts. * Both companies are competitors in many of the same industries (i.e. aerospace or aircraft and government contracts in the fields of defense systems and technological services). * They both depend heavily on U.S. government contracts. * Both companies have grown and succeeded through diversification and acquisition of smaller competitors. * Both companies have benefitted greatly from increased military spending due to 9/11 terrorist attacks.
How Raytheon and Textron differ. * Textron can use its finance department to lend money within the company and to extend loans to other organizations, a luxury Raytheon doesn’t have. (wikinvestment.com) * Textron’s finance division has been hit hard by recent slow economy and this has made their cash position uncertain which led to rumors of a possible Raytheon takeover of Textron in 2009. * Textron concentrates on small aircraft and military helicopters (over 50% of revenues in2009) and Raytheon main revenues come from radars and electro-optical sensors, missiles, satellite sensors, digital communication systems, and missile defense. (wikinvestment.com) * Raytheon depends on international contracts more than Textron. * Raytheon had issues with environmental contamination and lawsuits in 2008. Textron was named one of America's Safest Companies in 2008 by Occupational Hazards magazine. (Textron, Wikipedia.com)

Works Cited
“Company History”.www.textron.com. 2010. Web. 05 November 2010. <http://www.textron.com/about/company/history.php >.
“History”.www.raytheon.com. 2010. Web. 30 October 2010.
< http://www.raytheon.com/ourcompany/history/index.html >.
“Leadership”. www.raytheon.com. 2010. Web. 30 October 2010. <http://www.raytheon.com/ourcompany/leadership/>.
“Raytheon”. www.wikipedia.org. 04 November 2010. Web. 05 November 2010. <http://en.wikipedia.org/wiki/Raytheon>.
Raytheon.com. Web. 04 November 2010. <http://www.raytheon.com/>. “Raytheon Company”. www.fundinguniverse.com. Web. 03 November 2010. <http://www.fundinguniverse.com/company-histories/Textron-Inc-Company-History.html>.
“Textron”. www.wikipedia.org. 09 October 2010. Web. 31 October 2010. <http://en.wikipedia.org/wiki/Textron>.
“Textron Inc.”. www.fundinguniverse.com. Web. 01 November 2010. <http://www.fundinguniverse.com/company-histories/Raytheon-Company-Company-History.html>.
Wikinvest.com. 2010. Web. 02 November 2010. <http://www.wikinvest.com/stock/Textron_%28TXT%29>
<http://www.wikinvest.com/stock/Raytheon_Company_%28RTN%29>.
“William H. Swanson”. www.wikipedia.org. 23 October 2010.Web. 04 November 2010. <http://en.wikipedia.org/wiki/William_H._Swanson>.