American technology firm Harris and aerospace and defence company L3 Technologies have agreed to merge in an all-stock deal to establish a $33.5bn global defence technology conglomerate.

Named L3 Harris Technologies, the combined military technology company will be focused on developing differentiated and mission-critical solutions for military customers worldwide.

With the completion of the merger, Harris will own 54% shares and L3 Technologies will have a 46% stake in the conglomerate on a fully diluted basis.

Expected to generate an estimated net revenue of $16bn, L3 Harris Technologies will have customers in more than 100 countries and approximately 48,000 employees.

Once operational, the new establishment is expected to serve as the sixth largest military technology company in the US and one of the top ten global defence companies.

L3 Chairman president and CEO Christopher E Kubasik said: “This merger creates greater benefits and growth opportunities than either company could have achieved alone.

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“The combined company will be more competitive on cost, allowing it to expand its capabilities to offer end-to-end solutions across a wide range of military domains.”

“The companies were on similar growth trajectories and this combination accelerates the journey to becoming a more agile, integrated and innovative non-traditional ‘sixth prime’ focused on investing in important, next-generation technologies.”

The combined company will be more competitive on cost, allowing it to expand its capabilities to offer end-to-end solutions across a wide range of air, sea, land, space and cyber domains.

This will help expand the company’s position in radio frequency and spectrum technologies, as well as establishing a leading multi-platform supplier and integrator.

L3 Harris Technologies will comprise 12 members on its board of directors, with six directors from each company. The company will be headquartered in Melbourne in Florida, US.

The transaction is expected to close in mid-2019 subject to customary closing conditions, including approval by the shareholders of each company.

Morgan Stanley & Co serves as the financial advisor to Harris, while Sullivan & Cromwell operates as the principal legal counsel to the company.

Paul, Weiss, Rifkind, Wharton & Garrison will be the special counsel to the board of directors, while Goldman Sachs will act as the financial advisor and Simpson Thacher & Bartlett as the legal counsel to L3 Technologies.