WASHINGTON - The U.S. Department of War (DoW) plans to invest $1 billion in the Missile Solutions division of L3Harris Technologies (NYSE:LHX) Missile Solutions business. The company announced in a press release that the investment will be made through a convertible preferred security that will automatically convert to common stock in an initial public offering. L3Harris shares, which are trading at 340.68 US dollars, have performed impressively over the past year with a return of 62.3% and are currently trading near their 52-week high of 341.81 US dollars.
L3Harris intends to carry out an IPO of its Missile Solutions division in the second half of 2026. This is intended to create a listed company specializing in propulsion systems for rockets. L3Harris would retain a majority stake in the division following the transactions.
The investment aims to increase production capacity for solid rocket motors used in missiles by the US and its allies. This will support programs such as PAC-3, THAAD, Tomahawk and Standard Missile.
"We are taking action to build today's 'Arsenal of Freedom' by launching a pure-play missile solutions provider," said Christopher Kubasik, Chairman and CEO of L3Harris.
According to the company, the development of the standalone Missile Solutions business is expected to "unlock significant value" by sharpening its strategic focus and driving growth. This will benefit L3Harris, its shareholders and military customers.
L3Harris established the Missile Solutions division following the acquisition of Aerojet Rocketdyne, bringing together its capabilities in support of offensive and defensive missile systems. The company has already invested in the restructuring and expansion of its production facilities
According to the company, the planned partnership is in line with recent US government measures aimed at strengthening the defense industrial base and increasing competition in the industry.
L3Harris will hold an investor conference on Tuesday, January 13, 2026, at 9:00 a.m. ET to discuss the partnership.
