Rockwell Collins Chief Executive Kelly Ortberg explained that the combination offered substantial cost synergies and the ability to cross-sell electronics and plane fittings, along with positioning the merged companies to lead the development of so-called smart aircrafts – aerospace companies are heavily spending on development of aircraft systems and passenger facilities connected via satellite with the internet.

“B/E is very strong in relationships with airlines,” Ortberg told Reuters. “We’re stronger with aircraft makers as well as business aviation operators and the military. We’ll be able to sell our respective products into a much broader market base than either of us could do independently.”

B/E Aerospace is one of the world’s largest makers of aircraft seats and other interior fittings such as galleys, acquiring half of the market for coach seats and an even larger piece of luxury business-class seats.

While the industry has experienced a slowdown due to a stagnant business jet market, Ortberg expects hundreds of older widebodies could upgrade with new seats and systems over the next several years.

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SPDR S&P Aerospace & Defense ETF