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A Look At The Raytheon – United Technologies Merger Through An FCPA Lens

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A few days ago Raytheon Company and United Technologies Corporation announced entry “into an agreement to combine in an all-stock merger of equals.” The merger was unanimously approved by the Boards of Directors of both companies and is expected to close in the first half of 2020.

The aerospace and defense industries have significant points of contact with “foreign officials” in the global marketplace and thus a relatively high degree of FCPA risk. Indeed, United Technologies resolved an approximate $14 million FCPA enforcement action in 2018 regarding conduct in Russia, Azerbaijan, China, Kuwait, South Korea, Pakistan, Thailand, and Indonesia.

This post examines the Foreign Corrupt Practices Act and related provisions of the merger agreement as well as a prior example of how FCPA issues scuttled a defense industry merger.

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