Lockheed Martin to unload information systems unit, combining it with Leidos

Lockheed Martin Corp. is separating its information systems and global solutions unit, combining it with the engineering company Leidos so that it can focus on its remaining aerospace and defense business.

The division has about $5 billion in sales and more than 16,000 employees globally.

The company’s shares dropped more than 3% in morning trading Tuesday.

See more of our top stories on Facebook >>

Lockheed Martin will receive a special one-time payment of $1.8 billion. The Bethesda, Md., company’s shareholders will receive approximately 77 million Leidos shares with an estimated value of $3.2 billion.

Existing shareholders of Leidos Holdings Inc. will continue to hold the remaining outstanding shares.

Reston, Va.-based Leidos is expected to pay its shareholders a special dividend of about $1 billion.

The deal still needs approval from Leidos shareholders. It is expected to close in the second half of the year.

SIGN UP for the free California Inc. business newsletter >>

Shares of Lockheed Martin were down $6.19, or 2.9%, to $204.82 in morning trading. Its shares have edged up 3% over the last year.

ALSO

Uber is piloting smartphone tech to track speeding drivers

Twitter hires former American Express exec as chief marketing officer

Home prices jump in L.A. and Orange counties -- and soar in San Francisco