Raytheon said it will challenge Lockheed Martin’s planned acquisition of Aerojet Rocketdyne on anti-trust grounds amid reports that federal regulators will extend their review of the deal. Bloomberg reports:
“They are a huge supplier to us, and if that merger actually happens, you don’t have an independent supplier on the solid-rocket-motor side. And also, I think it gives us pause as we think about the competitive landscape going forward,” Raytheon Chief Executive Officer Greg Hayes said Wednesday at the Barclays Industrial Select virtual conference.
The proposed $4.4 billion deal would have a top competitor absorb a key supplier of solid rocket motors used in Raytheon’s missile systems. Hayes said the company would relay its concerns about the deal to the U.S. antitrust authorities and the Defense Department.
Lockheed announced the acquisition in December in an effort to expand expand its foray into missile defense and futuristic space travel, targeting higher sales and cost savings as defense budgets tighten.
Reuters reports that the Federal Trade Commission is likely to extend its 60-day review of the planned acquisition, which was due to expire at midnight on Thursday.
The $4.4 billion dollar deal, announced late last year, has raised eyebrows because Lockheed would take over a company that produces 70% of the solid fuel rocket motors and other propulsion products used in everything from antiballistic missiles, to air-to-air missiles.
Lockheed’s CEO, Jim Taiclet, said the deal could put Lockheed into a strong position in the growing propulsion and hypersonic weapons market.
Still, Taiclet has said Lockheed would simultaneously remain a partner to Aerojet’s current customer base by “providing outstanding propulsion products for the entire industry.”
