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Northrop Grumman combines divisions to lower costs

The moves affect businesses that build the unmanned Global Hawk spy plane and units that provide services and support to federal, state and local governments.

January 08, 2009|Bloomberg News

Northrop Grumman Corp. said Wednesday that it had combined seven units into five to lower costs.

The Integrated Systems group was combined with Space Technology to form the Aerospace Systems unit, led by Gary Ervin, the Century City company said.

The Information Technology and Mission Systems groups have combined as Information Systems, led by Linda Mills.

Northrop, the only builder of nuclear-powered aircraft carriers for the U.S. Navy, had already streamlined its shipbuilding business by combining its Newport News and Ship Systems units last January.

The aerospace and information groups each have annual sales of about $10 billion, the company said.

Ervin, 51, was president of the Integrated Systems division, and Mills, 59, had led the Information Technology group.

Philip Teel, 60, president of the old Mission Systems group, will retire Jan. 31. Alexis Livanos, 60, who was president of the space unit, will become Northrop's chief technology officer.

Northrop shares fell $1.33, or 2.7%, to $47.16.

The new aerospace unit includes businesses that build the unmanned Global Hawk spy plane used in Iraq and Afghanistan.

The information group provides services and support to federal, state and local governments, including building a wireless network for public-safety workers in New York.

Northrop's three other units -- electronics, shipbuilding and technical services -- are not affected by the reorganization.

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