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L3Harris Streamlines Portfolio with A.O.T. Sale to BWXT

Wesley ParkMonday, Jan 6, 2025 6:58 am ET
5min read


L3Harris Technologies, Inc. (NYSE: LHX) has completed the sale of its specialized materials business, Aerojet Ordnance Tennessee, Inc. (A.O.T.), to BWX Technologies, Inc. (NYSE: BWXT) for approximately $100 million. This strategic move aligns with L3Harris' multi-year plan to optimize its portfolio and deliver on commitments to customers and shareholders. Let's dive into the implications of this deal and what it means for both companies.



Portfolio Optimization for L3Harris

The sale of A.O.T. allows L3Harris to focus on its core competencies and strategic growth areas, such as integrated mission systems, space and airborne systems, and communication systems. By divesting non-core businesses like A.O.T., L3Harris can allocate more resources to these key segments, maintaining its competitive edge in the defense industry and continuing to provide mission-critical solutions for customers worldwide.

LHX Revenue By Business
Name
Date
Revenue By Business
L3HarrisLHX
2024
-149.00M


Expansion of BWXT's Special Materials Portfolio

For BWXT, the acquisition of A.O.T. enhances and grows its special materials portfolio, better serving its customers and contributing to its mission of ensuring national security. A.O.T. is a leading provider of advanced specialty materials, fabrication, and high-strength alloy manufacturing, making it an attractive addition to BWXT's Nuclear Operations Group.



Potential Cost Savings and Operational Efficiencies for L3Harris

Post-sale, L3Harris may achieve potential cost savings and operational efficiencies by focusing on its core businesses and reducing overhead and administrative costs associated with supporting the A.O.T. operations. The proceeds from the sale can be reinvested in L3Harris' core businesses or used to pay down debt, improving the company's capital structure and overall financial health.

Long-term Impact on L3Harris' Financial Performance

While the sale of A.O.T. may have a temporary impact on L3Harris' financial performance in the short term, it is expected to have a positive long-term impact by optimizing the company's portfolio, improving operational efficiency, and driving growth in core businesses. The cash generated from the sale can be reinvested in strategic growth areas, driving long-term value creation for shareholders.

LHX Basic EPS, Total Revenue YoY...


In conclusion, the sale of A.O.T. to BWXT is a strategic move for both companies, allowing L3Harris to focus on its core competencies and optimize its portfolio, while BWXT expands its special materials portfolio and gains access to key markets and technologies. This deal is expected to have a positive long-term impact on L3Harris' financial performance and shareholder value.
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throwaway0203949
01/06
BWXT flexing with A.O.T. addition, watch special materials growth.
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shackofcards
01/06
A.O.T. sale = smart move for L3Harris' future.
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MasterDeath
01/06
L3Harris dumping non-core biz, focusing on winners.
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McLovin-06_03_81
01/06
L3Harris cutting loose non-core biz, focusing on heavy hitters. Smart move for optimizing portfolio and cash flow. 🚀
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LividAd4250
01/06
Operational efficiencies coming? 🤑 L3Harris streamlining for gains.
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zarrasvand
01/06
Cash from sale? 🤔 L3Harris could boost core investments.
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bllshrfv
01/06
A.O.T. sale = L3Harris doubling down on tech where it counts. Core systems are where the gold's at, folks.
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tempestlight
01/06
L3Harris shedding A.O.T. like old skin. Time to reinvest in what makes them tick—mission systems and beyond.
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greyenlightenment
01/06
I'm holding $LHX, divestments signal strong strategic direction.
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McLovin-06_03_81
01/06
$LHX unloading A.O.T. like a pro. Means more ammo for their real moneymakers. 🤑
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bmrhampton
01/06
L3Harris dumping non-core biz for focus. Smart move. More resources for their bread-and-butter. 🍞💼
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Jazzlike-Check9040
01/06
BWXT snagging A.O.T. is a win for national security, and maybe a sleeper pick for investors.
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Outrageous_Kale_3290
01/06
Diversification is king. Holding $LHX for defense exposure but watching $TSLA for tech flavor. Balance is key, peeps.
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ultrapcb
01/06
Specialized materials biz change hands, but it's all about synergy and growth for these giants in the defense game.
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Georgina Morris
01/06

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