American arms manufacturer Lockheed Martin has canceled it agreement acquire rocket engine manufacturer Aerojet Rocketdyne Holdings.
Aerojet Rocketdyne manufactures aerospace and defense rocket engines and has 15 major operations throughout the United States.
The merger was predicted to expand Lockheed Martin’s experience in motor engineering.
Chairman, President and CEO of Lockheed Martin James Tekle said: “Our planned acquisition of Aerojet Rocketdyne would benefit the entire industry by increasing efficiency, speed and significantly reducing costs for the US government.
“However, we have determined that in light of the FTC’s actions, terminating the deal is in the interests of our stakeholders. We maintain our long-standing legacy as a supplier and trusted partner and will continue to support Aerojet Rocketdyne and other important defense-based suppliers that are still overcoming the pandemic challenge. ”
This announcement came after the U.S. Federal Trade Commission (FTC) filed a lawsuit seek a prior ban on cessation of acquisitions due to antitrust concerns.
In December 2020 Lockheed Martin reached the final deal to acquire Aerojet for a deal valued at $ 4.4 billion.
Now Lockheed Martin will make an effort to use its capital to get the most return on investment.
A statement from Aerojet Rocketdyne said: “We are ready to deliver significant value to our shareholders, thanks to our continued leadership in key space exploration and defense growth markets, including through the promotion of hypersonic and strategic, tactical and missile defense systems.
“Aerojet Rocketdyne achieved a high return on shareholders of 166% in the five years prior to the announcement of the deal, well above the aerospace and defense industry index by 33% and the S&P 500 by 62%.”
https://www.airforce-technology.com/news/lockheed-martin-aerojet-rocketdyne-acquisition/ Lockheed Martin decides to stop acquiring Aerojet Rocketdyne