Raytheon Names Kennedy as Successor to Swanson -- Update

By Doug Cameron and Tess Stynes 

Raytheon Co. on Wednesday named Thomas Kennedy to succeed William Swanson as chief executive in March, continuing the changing of the guard among the world's largest defense contractors.

Mr. Swanson has been CEO since 2003 and is credited with growing Raytheon into the fourth-largest defense company by sales through focusing on expanding international business and winning market share in fast-growing segments such as missile systems.

Raytheon signaled its succession planning last April when Mr. Kennedy was promoted to chief operating officer. Mr. Swanson, who turns 65 in February, will remain chairman.

The move will see five of the world's 10 largest defense companies having changed CEOs over the past 15 months, with Boeing Co. expected to join the list in the next year with the planned retirement of Jim McNerney. Lockheed Martin Corp., General Dynamics Corp. and Italy's Finmeccanica SpA all installed new CEOs last year, while BAE Systems PLC has hired a new chief for its semiautonomous U.S. unit.

The management changes come as the industry adjusts to the steepest drop in Pentagon funding since the Korean War, while parallel budget cuts by European countries have focused attention on defense sales to the Middle East and Asia.

Raytheon generated almost 30% of revenue from outside the U.S. last year, the highest portion among domestic peers, helped by sales of its trademark Patriot missile-defense system.

Mr. Kennedy, 58, has been with Raytheon for more than 30 years and formerly ran its integrated defense unit, which includes missile systems.

Mr. Swanson, who has been with Raytheon for more than 40 years, informed the board last year that he planned to retire after his 65th birthday next month.

Write to Doug Cameron at [e-mail] and Tess Stynes at [e-mail]

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