Lockheed Martin Corporation, the American aerospace and defense technology manufacturing giant, announced on Sunday that it would acquire U.S. rocket engine manufacturer Aerojet Rocketdyne at 4.4 billion USD.
The acquisition decision is the result of an attempt to give the company a larger footprint in space and hypersonic technology amid competition from aerospace manufacturers and private space enthusiasts like SpaceX and Blue Origin to acquire government space contracts.
According to Lockheed, the transaction is expected to close by the second half of next year. Lockheed will be paying $56 per share for Aerojet Rocketdyne, which is 33% more than Aerojet’s Fridays’ closing share price. This price will be further adjusted to $51 per share after the payment clearance of a pre-closing special dividend. The payment of acquisition will be made in cash as well as debt.
Jim Taiclet, CEO of Lockheed Martin, who took over this position in June this year, said,
Meanwhile, Eileen Drake, CEO of Aerojet, stated that partnering with Lockheed Martin is a huge opportunity as it will help them bring together their advanced technologies, expertise, resources, and their shared vision of strengthening the defense system for their nation along with boosting capabilities for space exploration and space travel.
Lockheed Martin’s existing business with Aerojet Rocketdyne includes using Aerojet’s propulsion systems in aeronautics, alongside utilizing its missiles and fire control components.
Lockheed Martin Corporation was established on March 15th, 1995, and is headquartered in Bethesda, Maryland, United States. It is an aerospace and defense system technologies, security devices, and ammo manufacturing company. Being the world’s largest defense contractor, Lockheed Martin operates four major businesses of Aeronautics, Missiles and Fire Control (MFC), Rotary and Mission Systems (RMS), and space.
Aerojet Rocketdyne is an American rocket and missile propulsion manufacturer, headquartered in Sacramento, California, founded in 2013. Aerojet Rocketdyne Holdings came into existence when Aerojet (then owned by GenCorp) merged with Pratt & Whitney Rocketdyne.