Textron Inc has said that it has agreed to acquire fellow plane maker Beechcraft Corp in a deal valued at $1.4 billion.

Textron, which is the manufacturer of Cessna planes and the Bell helicopter, will expand its per cent in the aviation market with the acquisition. Beechcraft has emerged from bankruptcy protection in February and has been looking for a buyer of its jet businesses as the company has been losing money on the division.

Textron said that the deal will be financed by combination of available cash and up to $1.1 billion in new debt. Experts have said that the one of the largest deal in the US would kick start a series of mega mergers in the aviation industry in the country. Beechcraft said in a statement that if it finds a higher bidder, it will have to pay a termination fee of $48 million to Textron.

Shares of Textron rose about 3 per cent in extended trading after the deal was announced. Credit Suisse and Morgan Stanley acted as the advisers to Beech Holdings while JP Morgan was also the financial adviser to Textron.