Ball Corp. agreed to sell its aerospace division to U.K. defense contractor BAE Systems for $5.6 billion in cash, the companies announced Thursday.
The deal is expected to close in the first half of next year, pending regulatory approval.
The aerospace unit of Colorado-based Ball, widely known for its beverage and household packaging products, deals in manufacturing spacecraft and specialized aerial systems. It counts NOAA, the Pentagon and U.S. intelligence agencies as some of its key customers.
BAE noted that more than 60% of Ball's 5,200 or so aerospace employees hold U.S. security clearances.
"The proposed acquisition of Ball Aerospace is a unique opportunity to add a high quality, fast growing technology focused business with significant capabilities to our core business that is performing strongly and well positioned for sustained growth," BAE Systems CEO Charles Woodburn said in a statement.
Ball began shopping around its aerospace division earlier this year, looking for a deal that would help trim its nearly $10 billion in debt. Ball said the transaction is expected to generate about $4.5 billion in after-tax proceeds.
Shares of Ball were up about 3% in midday trading Thursday.