WASHINGTON \u2015 The U.S. Federal Trade Commission is raising new accusations Lockheed Martin tried to block competition even before its proposed acquisition of Aerojet Rocketdyne, according to a complaint filed this week.<\/p>\n\n\n\n
The 22-page document, filed in federal court, spells out the details of the government\u2019s antitrust concerns about the proposed $4.4 billion deal between Lockheed, the world\u2019s largest defense firm, and Aerojet, the sole supplier of several critical propulsion products for missiles.<\/p>\n\n\n\n
The complaint, released Wednesday, is heavily redacted but argues the sale would hurt rival defense contractors in ways that would significantly reduce competition in multiple markets.<\/p>\n\n\n\n
In detailing their allegations, regulators provide a deep dive into some of the technologies the Pentagon is relying upon in its technological race with China and Russia. They point to Aerojet as a key supplier of scramjet engines for hypersonic missiles and control systems for missile interceptors, known as kill vehicles.<\/p>\n\n\n\n
Though Lockheed has said it would allow Aerojet to continue on as a merchant supplier of propulsion equipment to the entire industry, regulators spell out why they\u2019re not convinced.<\/p>\n\n\n\n
Before Lockheed agreed to purchase Aerojet, the complaint says \u201cLockheed sought unsuccessfully to prevent Aerojet from supplying Critical Propulsion Technologies to other prime contractors on a number of occasions.\u201d<\/p>\n\n\n\n
Regulators redacted text apparently detailing one alleged instance, but left the words: \u201cThis is not the first time Lockheed made such an attempt.\u201d<\/p>\n\n\n\n
The complaint says Lockheed, which has billed the acquisition as critical to its space and hypersonic businesses, sought to buy Aerojet because it was worried a rival might do so \u2014 but, again, details are redacted.<\/p>\n\n\n\n
\u201cLockheed feared such foreclosure risk to itself were one of its competing primes to acquire Aerojet,\u201d the complaint reads. \u201cThe defensive rationale for the Proposed Acquisition itself substantiates the criticality of the propulsion products Aerojet supplies and validates the concerns that control of these essential inputs could be wielded effectively to lessen competition.\u201d<\/p>\n\n\n\n
Lockheed said Wednesday its practice is not to comment on pending litigation and that it is reviewing the complaint.<\/p>\n\n\n\n
\u201cWe will review the lawsuit and consider our options,\u201d said Lockheed CEO Jim Taiclet on an earnings call Tuesday. In a company filing, Lockheed said the merger agreement lets either company terminate the deal if it hasn\u2019t closed on or before March 21.<\/p>\n\n\n\n
Throughout the complaint, Defense Department input to regulators is redacted. Pentagon spokesman John Kirby on Tuesday declined to provide details about the department\u2019s findings on the deal, which Deputy Defense Secretary Kathleen Hicks sent regulators in December.<\/p>\n\n\n\n
\u201cBecause our information was used for internal deliberations, I cannot share the department\u2019s recommendations,\u201d Kirby said.<\/p>\n","protected":false},"excerpt":{"rendered":"
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