United Technologies and defense contractor Raytheon agreed to merge in an all-stock deal described as a “merger of equals,” the companies announced on Sunday, creating a company with $74 billion in annual sales.

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The new company will be named Raytheon Technologies Corporation. Currently, United Technologies has a market value of $114 billion while Raytheon’s is about $52 billion.

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“By joining forces, we will have unsurpassed technology and expanded R&D capabilities that will allow us to invest through business cycles and address our customers' highest priorities,” United Technologies CEO Greg Hayes said in a statement. “Merging our portfolios will also deliver cost and revenue synergies that will create long-term value for our customers and shareowners."

Upon completion of the deal, which was unanimously approved by the boards of each company, United Technologies shareholders will own about 57 percent of the company, while Raytheon shareholders will own approximately 43 percent. Raytheon’s shareholders will receive 2.3348 shares in the combined company for each Raytheon share.

Ticker Security Last Change Change % UTX n.a. n.a. n.a. n.a. RTN n.a. n.a. n.a. n.a.

The deal to create the new company is expected to close in the first half of 2020, after United Technologies completes its spinoff of elevator-maker Otis and its building-systems business Carrier, which it announced in November 2018. The break up is expected to close by the first half of 2020. The merger is not expected to affect the separation, the companies said.

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Raytheon produces defense technologies and Tomahawk missiles, and United Technologies makes Pratt & Whitney engines, which power the Airbus A320neo, Airbus A220-100 and -300 series as well as the F-35 fighter jet.