(Reuters) – Raytheon Co and United Technologies Corp on Sunday agreed to combine their aerospace businesses in an all-stock deal, creating a $74 billion industry leader.

Raytheon shareholders will receive 2.3348 shares in the combined company for each Raytheon share, the companies said. The merger is expected to result in more than $1 billion in cost synergies by the end of the fourth year.

United Technologies shareholders will own about 57% of the combined business, which will be called Raytheon Technologies Corporation and be led by Greg Hayes, the current chief executive of United Technologies. Raytheon CEO Tom Kennedy will be named executive chairman.

The deal is expected to close in the first half of 2020, following the previously announced spin-off of United Technologies’ Carrier air conditioning and Otis elevator businesses.

United Technologies provides primarily commercial plane makers with electronics and communications equipment. Raytheon is a vendor mainly to the U.S. government for equipment in military aircraft and missiles.

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