Cites U.S. lawsuit as roadblock.
Steve Trimble
Credit: Jude Guidry/NASA
Singapore Airshow exhibitor Lockheed Martin has terminated a $4.4 billion agreement to acquire Aerojet Rocketdyne on the eve of the international aerospace event.
The decision announced late on Feb. 13 in the U.S. comes nearly three weeks after the U.S. Federal Trade Commission (FTC) sued to block the merger, citing concerns about the effect of such a merger on the competitive health of the industrial base.
“We determined that in light of the FTC’s actions, terminating the transaction is in the best interest of our stakeholders,” Jim Taiclet, Lockheed president and CEO said in a statement.
Aerojet remains the only stand-alone maker of large rockets and ramjets in the U.S. aerospace market.
Lockheed announced the original agreement with Aerojet on Dec. 20, 2020, during the last month of the Trump administration, which had approved the 2018 merger of Orbital ATK and Northrop Grumman.
In announcing the deal, Lockheed said that acquiring Aerojet would ultimately save the U.S. government money by streamlining both organizations.
But several of Lockheed’s competitors quickly rose to oppose the Aerojet acquisition, with Raytheon saying the deal would reduce competition on rocket engines and give Lockheed an unfair pricing advantage on certain components, such as divert and attitude control systems (DACS).
Aerojet has a monopoly on DACS technology for U.S. military programs, although DARPA is funding Northrop Grumman to develop an alternative system under the Glide Breaker program.
