Raytheon 2007 Annual Report Download - page 99

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 3: Acquisitions
In 2007, we acquired Oakley Networks, Inc. and the robotics technologies and capabilities of Sarcos for an aggregate of
$211 million in cash. We recorded $38 million in intangible assets, primarily related to completed technology and
customer relationships with a weighted-average life of 6 years and $165 million of goodwill in connection with these
acquisitions.
In 2006, we acquired Virtual Technology Corporation and Houston Associates, Inc. for an aggregate of $87 million in
cash. We recorded $18 million in intangible assets and $60 million in goodwill in connection with these acquisitions.
In 2005, we acquired UTD, Inc. for $39 million in cash. We recorded $2 million in intangible assets and $36 million of
goodwill in connection to this transaction. Also in 2005, we paid the third and final installment of $60 million related to
the 2003 acquisition of Solypsis Corporation.
Pro forma financial information has not been provided for these acquisitions as they are not material either individually
or in the aggregate.
We funded each of the above acquisitions using cash on hand. The operating results of these businesses have been
included with our results as of the respective closing dates of the acquisitions. The purchase price of these businesses has
been allocated to the estimated fair value of net tangible and intangible assets acquired, with any excess purchase price
recorded as goodwill. We completed these acquisitions to enhance our technology portfolio. The goodwill that is
tax-deductible related to these acquisitions is $109 million.
NOTE 4: Contracts in Process
Contracts in process consisted of the following at December 31, 2007:
(In millions) Cost Type Fixed Price Total
U.S. government end-use contracts
Billed $ 400 $ 286 $ 686
Unbilled 1,119 6,096 7,215
Less progress payments — (4,820) (4,820)
1,519 1,562 3,081
Other customers
Billed 32 417 449
Unbilled 63 825 888
Less progress payments — (597) (597)
95 645 740
Total $1,614 $ 2,207 $ 3,821
Contracts in process consisted of the following at December 31, 2006:
(In millions) Cost Type Fixed Price Total
U.S. government end-use contracts
Billed $ 605 $ 243 $ 848
Unbilled 860 5,766 6,626
Less progress payments — (4,566) (4,566)
1,465 1,443 2,908
Other customers
Billed 36 178 214
Unbilled 23 770 793
Less progress payments — (315) (315)
59 633 692
Total $1,524 $ 2,076 $ 3,600
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