Aerojet makes $2 billion offer for Lockheed-Boeing joint venture: sources
By Andrea Shalal
WASHINGTON (Reuters) - Aerojet Rocketdyne Holdings Inc (AJRD.N: Quote) submitted a $2 cash billion offer to buy United Launch Alliance (ULA), a satellite launch provider jointly held by Lockheed Martin Corp (LMT.N: Quote) and Boeing Co (BA.N: Quote), sources familiar with the matter said Tuesday, a deal that would further consolidate the space business.
Aerojet Rocketdyne board member Warren Lichtenstein, the chairman and chief executive of Steel Partners LLC, approached ULA President Tory Bruno and senior Lockheed and Boeing executives about the bid in early August, the sources said.
Aerojet Rocketdyne spokesman Glenn Mahone said the company would not comment on any negotiations with any company. Lockheed and Boeing declined comment. No immediate comment was available from ULA.
If successful, the deal would create a new large firm that builds both rockets and rocket engines. This follows February's merger of Orbital Sciences, a rocket builder, and enginemaker ATK to create Orbital ATK (OA.N: Quote).
Aerojet, which acquired Pratt & Whitney Rocketdyne in June 2013, would likely operate ULA as a separate unit, said one of the sources, who said former NASA Administrator Michael Griffin could be tapped to lead the unit.
ULA was created in 2006 after nearly two years of negotiations between Lockheed and Boeing, which overcome opposition from the Federal Trade Commission by arguing the venture would result in significant savings.
The venture has carried out 99 successful launches since its creation, but it has faced mounting political and financial pressures given a decline in expected U.S. government launches, and the rise of a competitor, privately held Space Exploration Technologies Corp, or SpaceX, founded by entrepreneur Elon Musk.
The Air Force this year certified SpaceX to compete with ULA for launches of certain military and spy satellites and said it would also phase out about $1 billion in launch support that it had provided to ULA for years. Continued...