UPDATE 1-Lockheed to split electronic systems business in two

WASHINGTON, Oct 8 (Reuters) - The largest U.S. weaponsmaker, Lockheed Martin Corp , said it plans to split itselectronic systems business into two separate operations focusedon missiles and training, a move it said would save $50 millionand eliminate 200 jobs.

The change, effective Dec. 31, will give Lockheed fivebusiness areas: aeronautics, space systems, information systems,missiles and fire control, and mission systems and training.

Marillyn Hewson, who currently heads the electronic systemsbusiness, is scheduled to take over as president and chiefoperating officer of Lockheed on Jan. 1.

Chris Kubasik, who is set to succeed Bob Stevens as chiefexecutive officer on Jan. 1, said the restructuring wouldstreamline Lockheed operations and strip out a layer ofmanagement at a time when the Pentagon is pushing contractors tolower overhead costs.

"This new structure will allow us to better support ourcustomers around the world and positions our company forsustained long-term growth," Kubasik said in a statement.

Lockheed said the new missiles and fire-control businesswill be based in Dallas, with 16,000 employees working onprograms such as Patriot PAC-3 missiles and missile defense.

It will be headed by long-time Lockheed executive RickEdwards, who previously managed tactical missiles and combatmaneuver systems for the company. The executive currently incharge of Lockheed's missiles business, Jim Berry, is retiring.

The mission systems and training business will be based inWashington with 19,000 employees working on the Aegis combatsystem, the Navy's Littoral Combat Ship, and as well as militaryand commercial training systems, the company said.

It will be headed by Dale Bennett, another Lockheed veteran,who took over as president of the company's mission systems andsensors business in August.

Lockheed shares were little changed at $94.25 on the NewYork Stock Exchange on Monday morning.

(Reporting By Andrea Shalal-Esa; editing by John Wallace)


Keywords: LOCKHEED/