Raytheon, Vista Equity Partners To Form New Cybersecurity Company - Quick Facts

(RTTNews) - Raytheon Company (RTN) said it has entered into a definitive agreement with Vista Equity Partners to form a new company combining Websense, a Vista portfolio company, with Raytheon Cyber Products, a business unit of Raytheon's Intelligence, Information and Services or IIS segment.

Raytheon said the new company will leverage its advanced cybersecurity technologies and Websense's industry leading TRITON platform to provide a new level of defense-grade cybersecurity to combat the evolving cyber threat environment.

Following successful completion of the transaction, the new company will be a separately reported Raytheon business segment. The CEO of the new company will be John McCormack, CEO of Websense. A Board of Directors will be established for the new company and will include representatives of both Raytheon and Vista Equity Partners, Raytheon noted.

Raytheon said its net cash contribution is about $1.57 billion for an 80.3% ownership of the joint venture and it will consolidate the results of the joint venture.

As part of the transaction, Raytheon will contribute $1.9 billion to acquire Websense, of which $600 million will be in the form of an intercompany loan to the joint venture. Raytheon will also contribute the assets of Raytheon Cyber Products and related intellectual property, which is valued at $400 million.

Vista Equity will subsequently invest approximately $335 million for a 19.7% equity stake in the new company.

Raytheon said it expects the transaction to close in the second quarter of 2015, subject to regulatory approvals and other closing conditions.