Lockheed Martin remains open to acquisitions despite Aerojet deal's demise

Aerojet Rocketdyne test-fires a solid rocket motor. (Aerojet Rocketdyne)

Lockheed Martin continues to consider potential mergers and acquisitions (M&A) even though it ended its proposed purchase of propulsion manufacturer Aerojet Rocketdyne amid opposition from anti-trust regulators, according to a Lockheed Martin official.

However, the US defence contractor plans to be more “cautious” and “analytical” to ensure that any deals it pursues are likely to receive government approval, Lockheed Martin chief financial officer Jay Malave told the Bank of America Securities 29th Annual Transportation, Airlines, and Industrials Conference on 19 May.

“There is still incoming in the pipeline that we continue to evaluate,” Malave said. “Obviously, our filter and our lens by which we review these has to be a little bit more specific and tighter than it would have been in the past from an anti-trust perspective, and making sure that it's something that could be actionable. But we haven't just completely said full stop, we're not going to look at M&A. We're going to continue to evaluate it, and if we think there's something that makes sense for the company, it's going to add value to the company, and we think that it could be actionable, then we will pursue it,” he added.

Lockheed Martin proposed buying Aerojet Rocketdyne in December 2020, saying that bringing the propulsion provider in-house would make designing and building missiles and rockets more efficient. However, Lockheed Martin abandoned the USD4.4 billion deal in February 2022 after the US Federal Trade Commission (FTC) sued to block the transaction. The FTC said the combination could have reduced competition in the missile market because Aerojet Rocketdyne is the last independent provider of missile propulsion in the United States.