Boeing, which reorganized its executive ranks yesterday in response to tighter Pentagon budgets, is also considering more dramatic actions. Dennis Muilenburg, head of Boeing's St. Louis-based defense business, told a Reuters conference yesterday that a big acquisition is a possibility. Reuters reports:

Boeing, which bought Argon ST for about $775 million in June to beef up its capabilities in sensors and communication technologies, continues to actively search for attractive deals in those areas, said Dennis Muilenburg, chief executive of Boeing's defense, space and security division.

"As we look at the marketplace, we've identified growth areas. We continue to actively look at opportunities there," Muilenburg said.

Asked if Boeing would consider a large-scale merger with a major defense contractor, Muilenburg said: "I'm not going to rule out or rule in any options." "Obviously as we see defense budget pressure, that does at times lead to potential consolidation," he said.