The Intercept - After Blocking Lockheed Martin Acquisition, FTC allows another Defense Firm to Close the Deal
Reporter Austin Ahlman shines a light on the FTC’s contradictory approval of L3Harris’ acquisition of Aerojet Rocketdyne in this article.
After the Federal Trade Commission blocked top defense contractor Lockheed Martin from acquiring a major rocket propulsion firm last year over monopoly concerns, the agency quietly allowed another defense firm that employs a former senior Pentagon official to secure the deal.
Following months of scrutiny, the FTC gave final regulatory approval in July for L3Harris, one of the largest defense contractors in the country, to acquire Aerojet Rocketdyne for $4.7 billion. L3Harris had announced that it would buy Aerojet Rocketdyne months after the FTC rejected Lockheed Martin’s bid in February 2022.
The FTC has repeatedly heralded the Lockheed Martin block as one of its major successes following the confirmation of reformist chair Lina Khan, who has reinvigorated the agency’s enforcement of antitrust laws. In a testimony to the Senate Judiciary Committee last September, Khan called Lockheed Martin’s abandoned attempt “a defense merger that would have eliminated the country’s only remaining independent supplier of key missile propulsion inputs.”
The Department of Defense, which has substantial influence over antitrust enforcement against defense contractors, also appeared to oppose the merger. In a report published the same month that Lockheed Martin’s bid fell through, the department stated that consolidation in the rocket motors sector had negatively impacted the stability of U.S. military industrial assets, which academics and industry experts refer to as the defense industrial base.
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