US FTC blocks Lockheed Martin $4.4 billion acquisition
The acquisition of Aerojet could affect the supply chain of missiles, such as this 34" common hypersonic missile pictured during a static fire test. (Photo: US Navy)
The US Federal Trade Commission (FTC) sued to block Lockheed Martin’s proposed $4.4 billion acquisition of Aerojet Rocketdyne Holdings on 25 January.
Aerojet Rocketdyne Holdings is the last independent US supplier of missile propulsion systems, which are critical components for the missiles made by all US defence companies.
Aerojet and only one other competitor, Northrop Grumman, currently compete to provide solid rocket motors for missile systems, hypersonic cruise missiles and supersonic combustion ramjets.
Moreover, Aerojet is the only proven US supplier of divert-and-attitude control systems that propel missile defence kill vehicles.
The FTC alleges that if the acquisition was to take place, then Lockheed would gain a monopoly on the missile supply chain and potentially limit supply to its competitors.
Holly Vedova, Director of the FTC Bureau of Competition, commented: ‘Without competitive pressure, Lockheed can jack up the price the US government has to pay’.
This concern is particularly relevant as the US is currently undergoing an arms race for better missile technology with China and Russia.
Lockheed Martin responded to Shephard, declining to comment on the pending litigation but stating: ‘We are reviewing the FTC’s complaint and will respond in due course.’
More from Defence Notes
-
Spain unveils new multi-billion euro defence investment plan
The new plan outlined how Spain would reach 2% of its GDP spend on defence by 2025, with €1.9 billion earmarked for new equipment acquisition with several land, naval and air platforms disclosed to be replaced or upgraded.
-
New Zealand boosts defence spend to US$6.6 billion and vows increased closeness with Australia
This budget will be spent over the next four years and nearly doubles the country’s defence spending as part of GDP to 2%.
-
UK Chancellor commits £2 billion to make the country a “defence industrial superpower”
Rachel Reeves announced port upgrades, protected budgets for innovation and investment in novel technologies.
-
Avalon 2025: Australian defence budget meets the low expectations of show attendees
The Australian Budget was marked by tax cuts and a looming general election which led to little hope that there would be a substantial defence boost even with a big bill for nuclear submarines due.
-
Launch of Gilat Defense targets DoD market
The communications company Gilat launched its new Gilat Defense division at the Satellite 2025 expo, with future solutions aimed at US military customers.