Good Monday. (Was this email forwarded to you? Sign up here.)

A new aerospace and military colossus emerges

The proposed merger of United Technologies’ aerospace division and Raytheon Technologies creates a big new maker of aircraft engines, jets and missiles, Michael de la Merced of the NYT reports. And it could spur more mergers in the sector.

Together, the two would have an estimated $74 billion in sales, and would produce F-35 fighter jets and Pratt & Whitney jet engines, which are used in Airbus airliners. United Technologies’ aerospace division and Raytheon would merge in a share swap, with the combined company being called Raytheon Technologies.

Work on the deal began after United Technologies announced last November that it would split into three publicly traded companies: its aerospace division; Otis, which makes elevators; and Carrier, which makes heating and cooling equipment. Raytheon’s C.E.O. reached out to his counterpart at United Technologies late in the year, saying the two should unite.

It’s the latest example of consolidation within the military and aerospace industries, creating a new colossus built to thrive in boom times and weather leaner ones. If military spending slows down, as analysts expect in the coming years, the bigger scale and cost savings of the deal could help buoy the combined company.